View Point https://1stattorneys.ng/articles Tue, 05 May 2026 22:48:14 +0000 en-US hourly 1 https://wordpress.org/?v=6.9.4 https://1stattorneys.ng/articles/wp-content/uploads/2026/05/cropped-1a-32x32.jpg View Point https://1stattorneys.ng/articles 32 32 CYBERCRIME, BREACH OF PEACE, AND ATTEMPTED FELONY: A CASE NOTE ON DSS V. JUSTICE MARK CHIDIEBERE https://1stattorneys.ng/articles/2026/05/05/cybercrime-breach-of-peace-and-attempted-felony-a-case-note-on-dss-v-justice-mark-chidiebere/ Tue, 05 May 2026 22:48:14 +0000 https://1stattorneys.com/articles/?p=990917

CYBERCRIME, BREACH OF PEACE, AND ATTEMPTED FELONY: A CASE NOTE ON DSS V. JUSTICE MARK CHIDIEBERE

ABSTRACT

On 4th May 2026, Justice Mark Chidiebere, popularly known as “Justice Crack,” was arraigned before Justice Joyce Abdulmalik at the Federal High Court, Abuja, on a three-count charge filed by the Department of State Services (DSS). He pleaded not guilty to all counts and was remanded in DSS custody until 25th May 2026. This article examines each charge against the legal framework of Nigerian law, analyses whether the charges hold water, cites relevant decided cases, and assesses the broader implications for free speech and fundamental rights in Nigeria.

1. INTRODUCTION

The criminal prosecution of Justice Crack represents the latest chapter in a case that began with his arrest by the Nigerian Army on 28th April 2026. Following public outcry and the Army’s admission that it lacked jurisdiction to detain a civilian, the Army transferred him to the DSS, which subsequently filed charges before the Federal High Court.

The charges, while formally brought under the Cybercrimes Act and the Criminal Code Act, raise fundamental questions about the criminalisation of public interest speech, the tension between national security concerns and freedom of expression, and the proper limits of criminal law in a democracy.

This article analyses each count in seriatim, examining the statutory elements of each offence, the actual position of Nigerian law as established by binding judicial precedents, and the likelihood that the charges will withstand judicial scrutiny at trial.

2. COUNT ONE: CYBERCRIME (FALSE INFORMATION)

2.1 The Allegation

Count One alleges that on or about 28th April 2026, Justice Crack circulated information to the public via his X handle, @JusticeCrack, regarding the alleged inadequate feeding of Nigerian Army personnel.

The prosecution alleges that he knew this information to be false but posted it for the purpose of causing annoyance, ill-will, and hatred, especially among citizens who hold divergent views.

This offence is said to be contrary to Section 24(1)(b) of the Cybercrimes (Prohibition, Prevention, etc.) Act, 2015 (as amended).

2.2 The Statutory Provision

Section 24(1)(b) of the Cybercrimes (Prohibition, Prevention, etc.) Act, 2015 provides that any person who:

“knowingly or intentionally sends a message or other matter by means of computer systems or networks that he knows to be false, for the purpose of causing annoyance, inconvenience, danger, obstruction, insult, injury, criminal intimidation, enmity, hatred, ill will or needless anxiety to another or causes such a message to be sent”

commits an offence under the Act.

2.3 Decided Cases on Section 24(1)(b)

The Nigerian courts have had occasion to interpret and apply Section 24(1)(b) of the Cybercrimes Act in several cases. Two notable cases are particularly instructive:

The Case of Seun Oloketuyi (2015)

In August 2015, the Nigerian Police arraigned Seun Oloketuyi, a publisher of a news website (naijahottestgist.com), before the Federal High Court, Lagos, on a two-count charge. The prosecutor alleged that the accused knowingly and intentionally published a defamatory story on the internet against Nnamdi Okonkwo, the Managing Director of Fidelity Bank Plc, in order to annoy and insult him. The prosecutor further alleged that the accused knew that the information he published was false.

The first count of the charge was specifically brought under Section 24(1)(b) of the Cybercrimes (Prohibition Prevention) Act, 2015, alleging that the accused “intentionally sent message and other matters by means of computer system or network against Okonkwo, which he knew to be false, for the purpose of causing him annoyance, insult and ill-will”.

Justice Mohammed Yunusa remanded the accused in Ikoyi prison and adjourned the case. This case demonstrates that the prosecution has, in practice, invoked Section 24(1)(b) against individuals for online publications alleged to be false and intended to cause annoyance.

Significance for Justice Crack’s Case:

The Oloketuyi case establishes that charges under Section 24(1)(b) are not unprecedented. However, it is important to note that the Oloketuyi case did not proceed to a final judicial determination on the interpretation of the section; it was resolved at the bail stage. The substantive elements of the offence, particularly the requirement of subjective knowledge of falsity and specific intent, were not judicially determined.

2.4 The Actual Position of the Law

The Cybercrime charge under Section 24(1)(b) requires the prosecution to prove subjective knowledge of falsity and specific intent to cause ill-will, which is a high evidentiary burden.

The Mens Rea Requirement: Knowledge of Falsity

The most critical element of Section 24(1)(b) is the requirement that the accused knew the information was false. The section uses the phrase “he knows to be false”. This is a subjective test: the prosecution must prove that Justice Crack had actual knowledge that his statement about inadequate feeding was false at the time he posted it.

This is a high evidentiary burden. The prosecution cannot merely show that the statement was false; they must prove that Justice Crack knew it was false. If he honestly believed the information to be true (even if mistaken), the mental element of the offence is not satisfied.

The Purpose Element: Intent to Cause Annoyance, Ill-Will, or Hatred

Even if the prosecution proves knowledge of falsity, they must also prove that Justice Crack acted “for the purpose of causing annoyance, inconvenience, danger, obstruction, insult, injury, criminal intimidation, enmity, hatred, ill will or needless anxiety to another”.

This is a specific intent requirement. The prosecution must show that Justice Crack’s dominant purpose was to cause one of these specified negative outcomes, not to inform the public, expose wrongdoing, or advocate for better soldier welfare.

2.5 Does This Charge Hold Water?

The Case for the Prosecution:

The prosecution will likely argue that the statement about inadequate feeding was false (if they can prove this through military records or testimony) and that Justice Crack either knew it was false or deliberately avoided verifying it before publication. The Oloketuyi precedent suggests that Nigerian prosecutors have successfully initiated charges under this section for similar allegations.

The Case for the Defence:

The defence has several strong arguments:

  1. Lack of Knowledge of Falsity: Justice Crack is a social media commentator, not a military whistleblower with access to classified feeding records. If he obtained his information from soldiers’ complaints (as the Army’s earlier statement suggested), he may have honestly believed the information to be true. The Army’s own initial investigation was triggered by soldiers’ complaints about feeding and welfare. If soldiers themselves were complaining, how can a civilian who amplifies those complaints be said to “know” the complaints are false?
  2. Legitimate Public Interest Purpose: The predominant purpose of the publication appears to be drawing public attention to soldiers’ welfare conditions, not causing annoyance or ill-will for its own sake. Discussing the welfare of security personnel is a matter of public interest. If the dominant purpose is public interest advocacy, the specific intent required by Section 24(1)(b) may be absent.
  3. Constitutional Free Speech Protection: Section 39 of the 1999 Constitution guarantees freedom of expression. In interpreting penal statutes that restrict free speech, courts apply a presumption in favour of liberty and require strict proof of all elements.

Verdict on Count One: Uncertain but Challenging for Prosecution

The charge is not frivolous, but the prosecution faces significant evidentiary hurdles. Proving subjective knowledge of falsity and specific intent to cause ill-will (rather than to inform) is notoriously difficult. If the defence can show that Justice Crack had reasonable grounds for believing his statement was true and that his purpose was public interest advocacy, the charge may fail.

3. COUNT TWO: BREACH OF PEACE

3.1 The Allegation

Count Two alleges that Justice Crack published a viral video and accompanying statements about the Nigerian Army which generated widespread negative reactions and were likely to cause fear and a breach of public peace.

This charge is brought under Section 59 of the Criminal Code Act.

3.2 The Statutory Provision

Section 59 of the Criminal Code Act states:

“Any person who, by writing, printing, or any other means, publishes or circulates any statement or report which is likely to cause fear and alarm to the public or to disturb the public peace, is guilty of a misdemeanor.”

3.3 Decided Cases on Breach of Peace by Publication

While there are limited Nigerian appellate authorities directly on Section 59 of the Criminal Code, cases from other jurisdictions and related provisions provide guidance.

The YABATECH Bursar Case (2016)

In a related context, the Lagos State Directorate of Public Prosecutions arraigned the former Bursar of Yaba College of Technology, Mr. Olugbenga Ibirogba, for allegedly leaking classified information. The defendants were charged with the offence of “provoking breach of peace by offensive publication, contrary to Section 57(1)(b) of the Criminal Law of Lagos State 2011,” by circulating several threat letters against the person of the college rector.

They were also accused of violating Section 59 of the Criminal Law of Lagos State 2011 for leaking the college’s secret. This case demonstrates that Nigerian prosecutors have invoked similar “breach of peace” provisions in the context of publication offences, though the substantive interpretation of the section was not fully litigated.

3.4 The Actual Position of the Law

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The Breach of Peace charge under Section 59 of the Criminal Code is weak as it requires proving the publication was likely to cause public fear and disturbance, not just negative reactions.

The “Likely” Standard

The offence requires that the publication be “likely to cause fear and alarm to the public or to disturb the public peace.” This is an objective test: would a reasonable person in the position of the public (or a segment thereof) be caused fear or alarm by the publication?

The test is not whether the publication actually caused fear or alarm, but whether it was likely to do so.

The “Public Peace” Requirement

“Public peace” refers to the absence of disorder, violence, or disturbance affecting the community at large. The offence is not concerned with private annoyance or individual discomfort, but with threats to public order.

3.5 Does This Charge Hold Water?

The Case for the Prosecution:

The prosecution will argue that the publication about inadequate feeding of soldiers, especially when coupled with the earlier allegations that soldiers were complaining about welfare conditions, was likely to cause fear and alarm among the public about the readiness and morale of the military.

The Case for the Defence:

The defence has several strong arguments:

  1. Legitimate Criticism Distinguished from Breach of Peace: Not every publication that causes negative reactions or controversy automatically constitutes a breach of peace. The law requires a specific likelihood of public fear and disturbance of public order. Criticism of government institutions, including the military, is protected speech under Section 39 of the Constitution.
  2. No Evidence of Actual Breach: The charge is based on what the publication was “likely to cause,” not on any actual breach of peace that occurred. In the absence of evidence that any public disorder actually resulted, the “likelihood” determination becomes highly speculative.
  3. Vagueness and Overbreadth Concerns: Section 59 is a broadly worded provision that, if interpreted expansively, could criminalise virtually any criticism of government institutions.

Verdict on Count Two: Weak Charge

This charge is on weaker footing than Count One. The connection between a report about soldier feeding and a likely breach of public peace is tenuous. Unless the prosecution can present evidence that the publication occurred in a context of particular volatility (e.g., during active mutiny or widespread civil unrest), it will struggle to prove that a reasonable person would have foreseen the publication causing public fear and disturbance of peace.

4. COUNT THREE: ATTEMPTED FELONY

4.1 The Allegation

Count Three accuses Justice Crack of attempting to commit a felony by publishing what the prosecution describes as derogatory video and statements about the Nigerian Army.

The charge is brought under Section 509 of the Criminal Code Act.

4.2 The Statutory Provision

Section 509 of the Criminal Code Act provides:

“Any person who attempts to commit a felony of such a kind that a person convicted of it is liable to the punishment of death or of imprisonment for a term of fourteen years or upwards, with or without other punishment, is guilty of a felony and is liable, if no other punishment is provided, to imprisonment for seven years.”

“Any person who attempts to commit a felony of any other kind is liable, if no other punishment is provided, to a punishment equal to one half of the greatest punishment to which an offender convicted of the felony which he attempted to commit is liable.”

4.3 Decided Cases on Section 509 and Attempted Felony

Mayaki v. Registrar, Magistrate Court (1990)

In Mayaki v. Registrar, Magistrate Court (decided 4th January 1990), the Court of Appeal had occasion to consider the nature of charges under Section 509 of the Criminal Code. The 3rd Respondent (accused person) was charged before the Magistrate Court for the offence of attempt to commit felony, to wit murder, contrary to section 509 of the Criminal Code Law of Lagos State.

The Appellants (complainants) applied to the Lagos High Court for orders of certiorari and prohibition, arguing that the Magistrate lacked jurisdiction to try the indictable offence of attempted murder. The court dismissed the application, and the appeal to the Court of Appeal was also dismissed.

The Court of Appeal held that:

“The offence with which the 3rd Respondent was charged as disclosed on the printed record of proceedings was attempted murder. It is an indictable offence. The accused person elected summary trial. The 2nd Respondent before whom the 3rd Respondent was arraigned was a Magistrate Grade I… The law gives a Magistrate Grade I power to impose a maximum sentence of three years. Therefore, as the law now stands all Magistrates other than a Magistrate Grade 3 have jurisdiction to try indictable offences in Lagos State subject to the accused person electing summary trial.” 

The court further noted that while the Magistrate has jurisdiction to try the offence, “The Magistrate will however not be able to impose any punishment greater than that stated in Section 18(5)(c) of the Magistrates’ Court Law as amended”.

Significance for Justice Crack’s Case:

The Mayaki case establishes that a charge under Section 509 is procedurally valid and can be tried by a magistrate or high court. However, the case also underscores that for an attempt charge to be sustainable, the underlying felony must be clearly identified. In Mayaki, the underlying felony was “murder,” which was explicitly stated.

Rex v. Anthony Enahoro (1947) – Incitement Distinguished

While not directly on Section 509, the case of Rex v. Anthony Enahoro (1947) from the West African Court of Appeal provides important guidance on what constitutes incitement, which may be the underlying felony alleged in Justice Crack’s case.

The appellant was convicted under Section 44(a) of the Criminal Code for advisedly attempting to seduce members of the Nigeria Police Force from their duty and allegiance. He had uttered words at a public meeting suggesting that police should not fire on citizens in the event of a riot.

The Court of Appeal upheld the conviction but provided important interpretive guidance, distinguishing between Section 44(a) and Section 45(b) of the Criminal Code:

“The real distinction is between advisedly attempting to seduce members of the Police Force from their duty and allegiance, that is to say, a deliberate attempt so to seduce them generally should certain events arise, and attempting to induce them, possibly on the spur of the moment, to disobey a specific order given them by a superior officer. The first strikes at the very basis of duty and allegiance, so that whenever certain circumstances shall arise they shall fail therein. The second aims at securing disobedience to a specific order given at a particular time.” 

The court held that to attempt to induce police to disobey their officers in the event of being ordered to quell a riot is an attempt to seduce them from their duty and allegiance to His Majesty.

Regarding the word “advisedly,” the court noted: “the word ‘advisedly’ as it appears in the relevant section… is equivalent to ‘knowingly'” .

Significance for Justice Crack’s Case:

The Enahoro case establishes a significant precedent: incitement requires a deliberate attempt to cause disaffection or disobedience, not merely criticism or commentary. The court specifically noted that the distinction is between “a deliberate attempt so to seduce them generally should certain events arise” and other forms of expression.

4.4 The Nwankwo Precedent: Constitutional Limits on Criminal Speech Laws

The binding precedent of Arthur Nwankwo v. The State (1985) establishes that criminalising criticism of the government is unconstitutional, serving as a strong defense against sedition or incitement charges.

A crucial precedent that bears directly on the constitutional validity of charges like those against Justice Crack is Arthur Nwankwo v. The State (1985) 6 NCLR 228.

In that case, the Anambra State High Court convicted and sentenced Nwankwo to one year imprisonment for publishing a book which had exposed corrupt practices under Governor Jim Nwobodo of Anambra State. The Court of Appeal set aside the conviction and sentence on the grounds that section 51 of the Criminal Code which provided for sedition was illegal and unconstitutional.

Speaking for the court, Justice Olajide Olatawura (as he then was) held:

“We are no longer the illiterates or the mob society our colonial masters had in mind when the law was promulgated…To retain S. 51 of the Criminal Code, in its present form, that is even if not inconsistent with the freedom of expression guaranteed by our Constitution will be a deadly weapon to be used at will by a corrupt government or a tyrant…Let us not diminish from the freedom gained from our colonial masters by resorting to laws enacted by them to suit their purpose.” 

Justice Olatawura further stated:

“The decision of the founding fathers of this present Constitution which guarantees freedom of speech which must include freedom to criticize should be praised and any attempt to derogate from it except as provided in the Constitution must be resisted. Those in public office should not be intolerant of criticism. Where a writer exceeds the bounds there should be a resort to the law of libel where the plaintiff must of necessity put his character and reputation in issue.” 

Significance for Justice Crack’s Case:

The Nwankwo case is directly relevant and potentially fatal to the prosecution’s case. The Court of Appeal explicitly declared that sedition laws (and by extension, laws that criminalise criticism of government and its institutions) are inconsistent with the constitutional guarantee of freedom of expression. Senior Advocate of Nigeria, Femi Falana, has cited this case in calling for the withdrawal of criminal charges against critics of public officials.

Falana has argued: “In view of the cautionary words of the Court of Appeal in Nwankwo v The State (supra), it is submitted that the resort to criminal libel and sedition by public officers to settle scores with critics and political opponents is illegal in every material particular” .

The prosecution’s argument that Justice Crack’s publication constitutes an “attempted felony” (presumably incitement or sedition) must be considered in light of this binding appellate authority.

4.5 The Natasha Akpoti-Uduaghan Precedent (2025)

More recently, in 2025, Senator Natasha Akpoti-Uduaghan was charged with criminal defamation for allegedly defaming the Senate President. The Socio-Economic Rights and Accountability Project (SERAP) and Femi Falana (SAN) called for the immediate withdrawal of the charges.

SERAP argued that the charges violated Section 39 of the 1999 Constitution and Nigeria’s international obligations under the African Charter on Human and Peoples’ Rights. Falana specifically cited the Nwankwo case in his demand for withdrawal of the charges.

Significance for Justice Crack’s Case:

The Akpoti-Uduaghan case demonstrates that there is growing judicial and legal opinion that criminalising speech through laws like sedition, criminal libel, and related provisions is constitutionally suspect. While the case did not proceed to a final judgment, the legal arguments made by SERAP and Falana represent persuasive authority that courts may adopt.

4.6 The Actual Position of the Law

For an Attempted Felony charge under Section 509 to be valid, the prosecution must clearly identify the specific underlying felony the accused allegedly attempted to commit.

What Constitutes an “Attempt”?

Under Nigerian criminal law, an attempt to commit an offence consists of:

  1. An intent to commit the substantive offence (mens rea)
  2. An act done towards the commission of that offence (actus reus)
  3. That goes beyond mere preparation.

What is the Underlying Felony?

Critically, Section 509 is not a standalone offence. It creates liability for attempting to commit another felony. Therefore, to charge someone under Section 509, the prosecution must first identify the specific felony that the accused allegedly attempted to commit.

The charge sheet in Justice Crack’s case does not publicly specify which felony he is alleged to have attempted. The charge merely states that he attempted to commit a felony by publishing derogatory videos and statements about the military.

4.7 Does This Charge Hold Water?

The Case for the Prosecution:

The prosecution might argue that Justice Crack attempted to commit either inciting to mutiny (under Section 44 of the Criminal Code) or sedition. However, the Enahoro case requires proof of a deliberate attempt to cause disaffection, not merely criticism.

The Case for the Defence:

The defence has very strong arguments against this charge:

  1. Failure to Specify the Underlying Felony: For an attempt charge to be valid, the prosecution must clearly identify the substantive felony that was allegedly attempted. Unlike in Mayaki v. Registrar, where the underlying felony (murder) was explicitly stated, this charge does not appear to specify the underlying felony. This alone may render the charge defective.
  2. No Act Beyond Preparation: Even if an underlying felony were specified, the prosecution would need to prove that Justice Crack did an act “towards the commission” of that felony that went beyond mere preparation. Publishing a video about feeding conditions, without more, is likely to be characterised as preparation (or mere expression) rather than an attempt.
  3. Mere Expression is Not an Attempt: In a democratic society governed by the rule of law, mere expression of opinion, even harsh or derogatory opinion, does not constitute an attempt to commit a crime unless accompanied by acts that directly advance criminal objectives.
  4. The Nwankwo Constitutional Bar: The Court of Appeal in Nwankwo v. The State declared that criminalising speech that criticises government is unconstitutional. This binding precedent may render the entire basis of the charge invalid.
  5. Circularity Problem: If the publication itself is alleged to be the “act towards the commission” of an unnamed felony, and the publication is also protected speech under the Constitution, the charge becomes constitutionally suspect.

Verdict on Count Three: Very Weak Charge

This charge appears to be the weakest of the three. The apparent failure to specify the underlying felony is a potentially fatal defect. Even if that defect were cured, the Nwankwo precedent suggests that criminalising political speech through sedition or incitement laws may be unconstitutional. The Enahoro case requires proof of deliberate attempt to cause disaffection, a high standard that may not be met by merely reporting on soldier welfare.

5. COMPARATIVE ANALYSIS OF THE THREE CHARGES

Count

Offence

Statutory Provision

Strength

Primary Weakness

Relevant Case Law

One

Cybercrime (false information)

S.24(1)(b), Cybercrimes Act

Moderate

Proving subjective knowledge of falsity and specific intent

Oloketuyi (2015) – established pattern of prosecution

Two

Breach of peace

S.59, Criminal Code

Weak

Tenuous link to public peace disturbance; vagueness concerns

Ibirogba (2016) – similar charge but not substantively interpreted

Three

Attempted felony

S.509, Criminal Code

Very weak

No underlying felony specified; Nwankwo constitutional bar

Mayaki (1990); Enahoro (1947); Nwankwo (1985)

6.1 The Tension Between Free Speech and Criminal Law

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The prosecution of Justice Crack highlights the ongoing tension between the use of criminal statutes to regulate online speech and the constitutional guarantee of freedom of expression in Nigeria.

The prosecution of Justice Crack highlights a recurring tension in Nigerian law: the use of criminal statutes to regulate online speech. As SERAP argued in the Akpoti-Uduaghan case, “Criminal defamation laws and lawsuits are inconsistent and incompatible with section 39 of the Nigerian Constitution and the country’s international obligations under the African Charter on Human and Peoples’ Rights and the International Covenant on Civil and Political Rights”.

6.2 The Nwankwo Doctrine

The Court of Appeal’s decision in Nwankwo v. The State (1985) established an important constitutional principle: sedition laws and laws that criminalise criticism of government are unconstitutional under Nigeria’s democratic framework. Justice Olatawura’s warning that such laws will be “a deadly weapon to be used at will by a corrupt government or a tyrant” remains prophetic.

6.3 The Role of Civil Remedies

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Civil remedies, such as defamation lawsuits, are the appropriate legal recourse for exceeding the bounds of free speech, rather than resorting to criminal prosecution.

One of the central critiques of using criminal law for speech-related offences is the availability of civil remedies. As Justice Olatawura stated in Nwankwo: “Where a writer exceeds the bounds there should be a resort to the law of libel where the plaintiff must of necessity put his character and reputation in issue”.

The Nigerian Army or the government could have sued Justice Crack for defamation in a civil court, seeking damages rather than imprisonment. The resort to criminal prosecution suggests, as some have argued, a desire to punish rather than merely to protect reputations.

6.4 The Burden of Proof

In all three counts, the prosecution bears the burden of proving every element beyond reasonable doubt. The high standard of proof in criminal cases is a significant protection for the accused. The defence does not need to prove innocence; it only needs to raise reasonable doubt as to any essential element.

7. POSSIBLE DEFENCES AND APPLICABLE CASE LAW

Justice Crack’s legal team may advance the following defences, supported by the cited case law:

  1. Truth/Reasonable Belief: If the statement about inadequate feeding of soldiers is true, or if Justice Crack had reasonable grounds for believing it to be true, the knowledge-of-falsity element of Count One is negated. The Army’s own investigation was triggered by soldier complaints, supporting this defence.
  2. Public Interest: The predominant purpose of the publication was public interest advocacy, not causing annoyance or ill-will. This negates the specific intent requirement under Section 24(1)(b).
  3. Constitutional Protection – Nwankwo DoctrineArthur Nwankwo v. The State (1985) 6 NCLR 228 establishes that criminalising criticism of government is unconstitutional. This is potentially the strongest defence against Counts Two and Three.
  4. Lack of Proximate Causation: The publication did not cause and was not likely to cause any actual breach of public peace, distinguishing this case from situations where there is clear evidence of public disorder.
  5. Defective Charge – Mayaki Principle: Following Mayaki v. Registrar, Magistrate Court (1990), a charge under Section 509 must specify the underlying felony. The apparent failure to do so may render Count Three legally defective.
  6. No Attempt – Enahoro Distinction: The Rex v. Enahoro (1947) case distinguishes between deliberate attempts to cause disaffection and mere commentary. Justice Crack’s conduct, if only reporting on welfare, falls on the commentary side of this distinction.

8. CONCLUSION

8.1 Summary of Findings

After a detailed analysis of each charge against the applicable provisions of Nigerian law and binding judicial precedents, the following conclusions emerge:

Count One (Cybercrime): This charge has legal substance based on the pattern established in Oloketuyi (2015). However, it faces significant evidentiary hurdles. Proving that Justice Crack knew the information was false and that his dominant purpose was to cause ill-will (rather than to inform the public) will be challenging for the prosecution.

Count Two (Breach of Peace): This charge is on weaker footing. The Ibirogba (2016) case shows that such charges have been brought, but the connection between a report about soldier feeding and a likely breach of public peace is tenuous. The Nwankwo doctrine also casts constitutional doubt on this charge.

Count Three (Attempted Felony): This is the weakest charge. The apparent failure to specify the underlying felony is a potentially fatal defect under the principles illustrated in Mayaki v. Registrar (1990). Even if cured, the Enahoro (1947) case requires proof of a deliberate attempt to cause disaffection, and the Nwankwo (1985) precedent may render criminalisation of such speech unconstitutional.

8.2 The Weight of Binding Precedent

The most significant legal authority favouring Justice Crack is Arthur Nwankwo v. The State (1985) 6 NCLR 228. The Court of Appeal’s declaration that sedition laws are “a deadly weapon to be used at will by a corrupt government or a tyrant” and that they are inconsistent with the constitutional guarantee of freedom of expression is binding on all lower courts.

Femi Falana (SAN) has properly invoked this precedent in calling for the withdrawal of criminal charges against critics of public officials, stating that “the resort to criminal libel and sedition by public officers to settle scores with critics and political opponents is illegal in every material particular”.

8.3 The Broader Implications

Regardless of the outcome of this specific case, the prosecution of Justice Crack raises important questions about the state of free speech in Nigeria. The use of criminal law to regulate online commentary about government institutions, particularly the military, has a chilling effect on public discourse.

The Nigerian courts have historically risen to the occasion when fundamental rights are threatened. The Court of Appeal did so in Nwankwo in 1985. The question is whether the Federal High Court in 2026 will follow that binding precedent and protect free speech rights in the digital age.

8.4 Final Assessment

To answer the central question: Do the charges hold water?

  • Count One: Partially holds water, but the prosecution’s evidentiary burden is high.
  • Count Two: Barely holds water; the link to public peace is weak, and the Nwankwo doctrine raises constitutional concerns.
  • Count Three: Does not hold water; the charge appears legally defective and may be unconstitutional under Nwankwo.

The strength of the prosecution’s case will ultimately depend on evidence that has not yet been publicly disclosed. However, the binding precedents of the Court of Appeal, particularly Nwankwo v. The State, provide a robust legal framework for the defence to challenge the constitutionality of criminalising political speech.

What is clear is that this case will be closely watched as a test of Nigeria’s commitment to free speech, the rule of law, and the proper limits of criminal prosecution for online expression.

TABLE OF CASES CITED

Case Name Citation Court Relevance
Arthur Nwankwo v. The State (1985) 6 NCLR 228 Court of Appeal Declared sedition laws unconstitutional; binding authority that criminalising criticism of government violates free speech
Rex v. Anthony Enahoro (1947) LJR-WACA West African Court of Appeal Defines “advisedly” as “knowingly”; distinguishes between incitement and commentary
Mayaki v. Registrar, Magistrate Court (1990) 4 January 1990 Court of Appeal Addresses Section 509 charges; requires underlying felony to be specified
Seun Oloketuyi 2015 (unreported) Federal High Court, Lagos Demonstrates pattern of prosecution under Section 24(1)(b)
Olugbenga Ibirogba 2016 (unreported) Lagos State High Court Demonstrates use of breach of peace provisions for publications

REFERENCES

  1. Constitution of the Federal Republic of Nigeria, 1999 (as amended)
  2. Cybercrimes (Prohibition, Prevention, etc.) Act, 2015 (as amended 2024)
  3. Criminal Code Act, Cap C38, Laws of the Federation of Nigeria, 2004
  4. African Charter on Human and Peoples’ Rights (Ratification and Enforcement) Act, Cap A9, Laws of the Federation of Nigeria, 2004
  5. TheCable (2026). “DSS arraigns influencer over alleged attempt to incite soldiers” 
  6. The Guardian (2026). “Alleged Cybercrime: DSS arraigns Chidiebere Justice Mark trial for May 25” 
  7. The Eagle Online (2015). “Online Publisher remanded in prison for defamatory publication on Fidelity Bank MD” 
  8. The NEWS Nigeria (2015). “Nigerian blogger sent to jail over malicious publication” 
  9. Punch Newspapers (2016). “Ex-YABATECH bursar remanded for leaking college’s secret” 
  10. Tribune Online (2025). “Withdraw criminal libel charge against Natasha , Falana tells FG” 
  11. The NEWS Nigeria (2025). “Withdraw Charges Against Senator Natasha Akpoti-Uduaghan” 

This article is provided for academic and informational purposes and does not constitute legal advice. The analysis is based on publicly available information and the applicable provisions of Nigerian law as of the date of publication. The author is not affiliated with any party to the litigation.

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Beyond the Robe: The Hidden Psychology of Judicial Decisions https://1stattorneys.ng/articles/2026/05/04/beyond-the-robe-the-hidden-psychology-of-judicial-decisions/ Mon, 04 May 2026 08:21:50 +0000 https://1stattorneys.com/articles/?p=990908

Beyond the Robe: The Hidden Psychology of Judicial Decisions

I. Introduction: Of Hopes Betrayed and Judgments Shadowed

On March 8, 2019, the Independent National Electoral Commission declared Emeka Ihedioha the winner of the Imo State governorship election in Nigeria. He was sworn in, took office, and set to work. Seven months later, on January 14, 2020, the Supreme Court issued a ruling that sent shockwaves through the nation: Ihedioha was out; Hope Uzodinma, who had finished a distant fourth, was in. Justice Kudirat Kekere-Ekun, delivering the lead judgment, reasoned that votes from 388 polling units had been unlawfully excluded from Ihedioha’s tally. The judgment was legally technical, but the perception among millions of Nigerians was visceral: the judiciary, the so-called “last hope of the common man”, had become the instrument of political engineering.

When the 2023 presidential election petition reached the courts, this perception only deepened. On October 26, 2023, the Supreme Court affirmed President Bola Tinubu’s victory, dismissing the appeals of opposition candidates Alhaji Atiku Abubakar of the Peoples Democratic Party and Peter Obi of the Labour Party for “lacking in merit,” holding that Atiku had not proven that the Independent National Electoral Commission had violated the Electoral Act in the conduct of the election. The decision was the final chapter in a post-election litigation process that is “not only voluminous but also slow, taking an average of 8 to 9 months” for presidential petitions at the Supreme Court. A 2025 report from the Policy and Legal Advocacy Centre (PLAC) analyzing the 2023 election petitions concluded that the tribunals’ decisions were often difficult to evaluate against Nigeria’s legal framework, raising fundamental questions about judicial consistency.

Whether the Uzodinma, Tinubu, or similar rulings are accurate is beside the point for the purpose of this chapter. The point is that such perceptions are possible, indeed inevitable, because judging is a human activity, and human cognition is never perfectly neutral. For centuries, the legal profession has clung to what might be called the “empty vessel” myth: the idea that judges, through training, experience, and sheer force of will, can set aside their biases, emotions, and political commitments and simply “apply the law to the facts”. A growing body of research in cognitive psychology, behavioral economics, and neuroscience suggests otherwise.

II. The Cognitive Toolkit of the Judicial Mind

A. Decision Fatigue: The Israeli Parole Case That Launched a Thousand Reforms

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Decision fatigue leads judges to default to the status quo, such as denying parole, as cognitive resources deplete over a session.

In 2011, researchers Shai Danziger, Jonathan Levav, and Liora Avnaim-Pesso published a study analyzing over 1,100 parole rulings issued by eight experienced Israeli judges over a ten-month period. The cases were heard in sequential order, and the judges took two food breaks, a morning snack and a lunch break, during each session. The researchers found that the proportion of favorable rulings (parole granted) started the day at approximately 65 percent. As the session wore on, it steadily declined, falling to nearly zero just before each break. After the break, favorable rulings shot back up to 65 percent. The judges who had spent the morning denying parole after parole were, by the end of the session, denying parole to just about everyone, regardless of the merits of their cases.

The explanation is simple but sobering. Judges, like all humans, suffer from decision fatigue: the gradual depletion of cognitive resources after making repeated judgments. When fatigued, the brain defaults to the easiest available decision path. For a parole judge, the easiest path is to deny parole, to maintain the status quo rather than to risk releasing a prisoner who might reoffend. As a New York Times reporter covering the study observed: “As people get tired, they look for shortcuts, and one of the easiest shortcuts is to uphold the status quo, in this case, denying parole.” Subsequent replications and critiques have debated the precise magnitude of the effect, but the core finding, that extraneous factors like time of day and meal breaks reliably predict judicial outcomes, has been robustly confirmed.

B. Anchoring: The Prosecutor’s Irrelevant Number

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Anchoring effects cause judges to unconsciously align sentences with arbitrary numbers, giving a structural advantage to whoever speaks first.

The most powerful tool in a prosecutor’s rhetorical arsenal may not be the evidence, but a number, any number, even an absurd one. In a classic experiment, psychologists Birte Englich, Thomas Mussweiler, and Fritz Strack presented experienced German judges with a fictional rape case. The prosecutor made a sentencing demand. For half the judges, the demand was high (34 months); for the other half, it was low (2 months). The demand was explicitly described as “random”, the prosecutor had rolled dice to determine it. The judges knew the anchor was arbitrary. And yet, judges exposed to the high anchor-imposed sentences that were, on average, significantly longer than those exposed to the low anchor.

The anchoring effect operates through what psychologists call “selective accessibility”: once an anchor is presented, the decision-maker unconsciously generates arguments and evidence consistent with that anchor. The high anchor makes incriminating arguments more cognitively accessible; the low anchor makes exculpatory arguments more accessible. The judge does not feel biased, but the evidence he weighs is shaped, unconsciously, by the first number he hears. Importantly, research shows that when the defense provides a counter-anchor, the prosecution’s initial anchor retains disproportionate influence. The structural advantage of speaking first is cognitive, not merely procedural.

C. Confirmation Bias: The Pretrial Detention Trap

Pretrial detention decisions can trigger confirmation bias, skewing a judge’s interpretation of subsequent evidence toward conviction.

Confirmation bias is the tendency to seek, interpret, and remember evidence in ways that confirm one’s pre-existing beliefs or hypotheses. In judicial contexts, perhaps its most insidious manifestation is the pretrial detention effect. A 2018 study published in Psychology, Crime & Law examined whether judges’ decisions to detain a defendant pretrial trigger confirmation bias in their subsequent guilt assessments. The findings were stark: judges who had ordered pretrial detention were significantly more likely to interpret ambiguous evidence as favoring conviction, to discount exculpatory evidence, and ultimately to find the defendant guilty.

Once a judge has decided about a defendant’s dangerousness, that initial judgment becomes a lens through which all subsequent evidence is filtered. This bias is particularly concerning in jurisdictions where pretrial rates are high and where bail decisions are made quickly, often based on limited information.

D. Hindsight Bias: The Unfair Curse of Knowing the Outcome

“Of course, he should have seen it coming”, this is the refrain of the hindsight bias. After an accident, after a crime, after a business failure, the outcome seems obvious, inevitable, foreseeable. But it was not obvious beforehand. Yet judges, juries, and arbitrators are routinely asked to evaluate decisions that were made under conditions of uncertainty, with full knowledge of how those decisions turned out.

Consider a negligence case involving a police officer’s split-second use of force. Knowing that the suspect was armed, a judge evaluating the officer’s actions will naturally think: “Of course she should have shot him, he was dangerous.” But the judge’s knowledge of the weapon is outcome knowledge that the officer did not have at the relevant moment. Reconstructing a truly uncertain ex ante perspective is cognitively difficult, perhaps impossible, once the outcome is known. Expertise does not help; experienced judges often construct coherent narratives that integrate the outcome into a plausible chain of causation, making the bias worse.

E. Framing and Affect: The Judge’s Mood and the Lawyer’s Word Choice

The same legal question, framed in positive or negative terms, can produce opposite rulings. This is the framing effect. In settlement negotiations, for instance, a judge told “there is a 75 percent chance of losing if this case goes to trial” will perceive settlement differently than if told “there is a 25 percent chance of winning.” The objective probabilities are identical; the emotional valence is not. Research shows that such framing manipulations reliably affect judicial decisions about settlement, discovery, and evidentiary rulings.

Affective bias, the influence of mood and emotion on judgment, operates even more broadly. A 2017 study examining the behavior of US federal judges found that unexpected losses by a prominent local college football team increased sentence lengths assigned during the week following the game. Losing primes punitive responses; winning primes leniency. Judges with the heaviest dockets in cities with a college team were most affected, a finding that speaks directly to the combined effect of decision fatigue and emotional priming.

F. Egocentric Bias: The Judge’s Own Experience as a Lens

Egocentric bias refers to the tendency to rely too heavily on one’s own perspective, experiences, and values when evaluating the experiences of others. In judicial contexts, this manifests in predictable patterns. Former prosecutors tend to view evidence through a prosecutorial lens; former defense attorneys through a defensive lens; judges from wealthy backgrounds struggle to understand the constraints facing a poor defendant. If the judiciary is drawn from elite backgrounds, then elite perspectives will be disproportionately represented. This is not malicious; it is a matter of cognitive availability. The experience of poverty is simply not available as a framework for understanding.

III. Political and Social Biases in Judicial Decisions: A Global Survey

Judicial decisions globally are influenced by political and social biases, including racial disparities, ideological alignment, and systemic capture.

A. The United States: Ideology and Race on the Federal Bench

The idea that American federal judges are apolitical “umpires calling balls and strikes” has become untenable. A comprehensive study examining over 400,000 cases from 1985 to 2020 found that judges’ political alignment with or against trial judges increasingly affects their decisions, particularly in the last two decades. Since the 1990s, the political affiliation of appellate panel judges “has mattered more often” in case outcomes, and “these partisan effects have grown over time, particularly within the subset of cases most likely to be ideologically salient”.

The most disturbing dimension of this bias is racial and ethnic. Research examining criminal cases before the US Supreme Court from 2005 to 2017 found that the court’s decisions “reflect broad patterns of thinking in society which link race and criminality”. Conservative justices are consistently less likely than liberals to side with criminal defendants, and that gap grows wider for defendants of color compared to white defendants, and for crimes that carry racialized connotations of danger. The cases of Joell Palmer (white, who won his appeal) and Terrance Bostick (Black, who lost), both involving nearly identical police roadblock stops, illustrate how “judgments about crime are often judgments about race “. The difference, the research suggests, may have been the men’s racial identities: Joell is white, and Terrance is Black”.

Even the scheduling of cases reflects ideological polarization. Research on electoral cycles among US Courts of Appeals judges found that just before presidential elections, judges double the rate at which they dissent and vote along partisan lines, from 6 percent to nearly 12 percent, immediately returning to 6 percent after the election. This is a striking demonstration that political context directly shapes judicial behavior.

The Roe–Dobbs Arc: A Case Study in Multiple Biases

No line of American cases better illustrates the interaction of cognitive and social biases than the 50-year arc from Roe v. Wade, 410 U.S. 113 (1973) to Dobbs v. Jackson Women’s Health Organization, 597 U.S. ___ (2022). In Roe, the majority framed abortion as a medical right and anchored debate to the “trimester framework.” In Dobbs, Justice Alito’s majority reframed the issue as a historical inquiry (“deeply rooted in the Nation’s history”), a classic framing effect that made the outcome nearly inevitable. The two dissenting justices in Roe (White and Rehnquist) and the six justices in the Dobbs majority each exhibited motivated reasoning, the tendency to generate legal justifications for ideologically preferred outcomes. The correlation between appointing president and voting outcome is nearly perfect, demonstrating political bias channeled through the appointment process.

The Dobbs majority also displayed hindsight bias, judging Roe “egregiously wrong from the start” with the benefit of 50 years of subsequent controversy, a perspective unavailable to the 1973 Court. Meanwhile, during their confirmation hearings, Justices Kavanaugh and Gorsuch had called Roe “settled precedent”; their votes to overrule it illustrate the confirmation bias dynamic of privileging evidence that aligns with pre-existing commitments. The unprecedented leak of Alito’s draft opinion triggered intense emotional reactions on all sides, an instance of the affect heuristic overriding cool legal analysis. Thus, the Roe–Dobbs arc encapsulates anchoring, framing, motivated reasoning, hindsight bias, confirmation bias, the affect heuristic, and structural political bias – all within a single line of cases.

B. Nigeria: Courts as Political Battlefields Reflecting Broader Systemic Capture

If political bias in America is statistical, in Nigeria it is often open. The country’s election petition tribunals have become, in the words of one legal observer, “the last hope of the common man” turning into the “lost hope of the common man,” with 1,282 out of 1,496 elective offices in 2007, 85.7 percent, ending up in tribunals. Post-election litigation is “not only voluminous but also slow,” draining the judiciary of institutional assets like credibility, impartiality and independence.

The political influence over judicial appointments is the key structural mechanism. State governors control appointments through Judicial Service Commissions, creating a system where a governor can reasonably expect favorable rulings from judges whose careers he controls. A high-profile 2025 report from PLAC analyzing the 2023 election judgments found that “the courts only have jurisdiction in election suit before the candidate returned as elected is sworn in”, yet petitions routinely run for months after inauguration, perpetuating an environment where judicial intervention in political processes is both expected and feared.

C. The United Kingdom: Racial Disparities in the Crown Court

R. v. Lucy Connolly [2024] EWCA Crim 1102 provides a vivid illustration of how racial bias operates in sentencing. On October 31, 2024, in Birmingham Crown Court, Recorder HH Judge Inman KC sentenced Lucy Connolly, the wife of a Conservative party councillor, to 31 months imprisonment for inciting racial hatred. Connolly had posted on social media urging others to “set fire to all the hotels full of the bastards” after the August 2024 stabbing of three schoolgirls, an attack that sparked nationwide anti-immigration rioting. The prosecution argued “there was a high level of racial aggravation, the defendant was a member of a group promoting racial hostility and caused serious fear and distress” . The sentence was upheld on appeal.

Beyond individual cases, empirical research on Crown Court sentencing has identified systemic racial disparities. A 2025 study in the British Journal of Criminology found that while judges claim to sentence based on offender-specific factors like remorse, good character, and ability to rehabilitate, these factors are applied in a racially biased manner: all three “clearly favour White offenders” . The study concluded that “judicial discretion and an assessment of the offender have a high risk of being racially determined, and therefore, operate as precursors of ethnic disparities in sentencing” .

Even in high-profile grooming cases, concerns about racial bias have disrupted proceedings. In June 2025, the first jury in a major grooming trial was discharged over concerns that a juror, thought to be a former police officer, may be racist, requiring a second jury to be seated .

D. Canada: Gladue and the Weight of Colonial Legacy

R. v. Gladue [1999] 1 S.C.R. 688 and R. v. Ipeelee [2012] 1 S.C.R. 433 created a unique legal framework instructing judges to consider the unique historical and social circumstances of Indigenous offenders. Section 718(2)(e) of the Criminal Code aims at reducing the imprisonment of Indigenous people, whose over-incarceration is not the result of explicit racism but of applying neutral criteria to populations systematically disrupted by colonialism.

The principle continues to evolve through high-profile cases. R. v. Cope, 2024 NSCA 59 involved an Indigenous appellant who pleaded guilty to aggravated assault of his intimate partner, “who is also Indigenous” . The appellant was on remand and received a five-year sentence. The Supreme Court of Canada heard the appeal in December 2025, a “rare sentencing appeal with far-reaching implications for Indigenous communities,” with 20 intervenors weighing in on “how courts should sentence Indigenous offenders when the victim is also Indigenous” . The tension is between reducing over-incarceration and protecting Indigenous women, an area where Gladue principles are being actively tested, with the Supreme Court hearing arguments in December 2025 on the proper application of Gladue principles in sentencing Indigenous persons (represented by the CCLA as intervenor).

In R. v. Zoe (2024), after accepting a Gladue report, the Northwest Territories Court of Appeal overturned the Territorial Court’s designation of Mr. Zoe as a dangerous offender, noting the “importance of the Gladue Report to the merits of Mr. Zoe’s case” . An Alberta Court of Appeal decision in 2025 replaced a jail sentence with house arrest for an Indigenous offender who fractured a man’s skull, the Supreme Court upheld the sentence as consistent with Gladue .

Gladue thus represents a structural intervention: ensuring judges have relevant information about Indigenous background before imposing sentence.

E. Germany: Anchoring in Civil Law Contexts

Germany’s civil law tradition and professional career judiciary might be expected to produce less biased decision-making than common law systems, but anchoring studies there suggest otherwise. Judges assimilate their sentences toward irrelevant prosecutor demands they know are randomly determined, the effect persists even among senior law students “who have studied the law at a high level” and practicing judges.

Englich and Mussweiler (2001) showed that 44 senior German law students given a rape case scenario imposed longer sentences in a high-anchor condition and shorter in a low-anchor condition. More recent pre-registered experiments with 475 German law students examined “combined anchoring”, where the prosecution and defense present sequential demands, finding that the prosecution’s initial anchor retains disproportionate influence even when the defense speaks later . The structural advantage of speaking first is cognitive.

F. Australia: Refugee Judgments and the Shadow of Prejudice

Research on Australian refugee tribunals has found that “for most offences, there will be a sentencing guideline which judges must follow,” yet even with binding guidelines, outcomes vary systematically. The High Court of Australia has handled a series of migration cases where judicial discretion is tested: CZA19 v Commonwealth of Australia; DBD24 v Minister for Immigration [2025] HCA 8 (April 2, 2025) involved two asylum seekers from Poland and Vietnam detained while their protection applications were processed, and the question for the Full Court was whether the detention was unlawful  The Court held that the detention was not unlawful, but the narrow five-to-four split (Gageler CJ; Gordon, Edelman, Steward, Gleeson, Jagot and Beech-Jones JJ) reinforced the variability of judicial decision-making in migration cases . A 2022 study examined over 6,700 applications for judicial review of refugee decisions, finding approval rates varying from 70 percent per judge to under 20 percent, variability that cannot be explained by case characteristics alone.

Australia’s High Court has handled other high-profile migration cases where judicial discretion was tested: Pearson v Commonwealth of Australia [2024] HCA 46 (December 4, 2024) on immigration detention and visa cancellation, and Plaintiff S15/2025 on whether Australia’s non-refoulement obligations are respected when visas are canceled on character grounds . In NZYQ v Minister, the Court held by majority that it is permissible to “defer” consideration of non-refoulement claims raised in a request to revoke a visa cancellation on the basis that these claims will be assessed later in a protection visa application.

Research on Ismail v Minister for Immigration, Citizenship and Multicultural Affairs [2024] HCA 2 found that even in unanimous rulings, the reasoning of the High Court reveals underlying ideological assumptions about the weight to be given to different factors in character-based visa cancellations.

G. Brazil: Anti-Political-Class Bias and the Politicized Court

Operation Car Wash (Lava Jato) was the largest corruption investigation in Latin America, exposing a vast bribery network involving construction giant Odebrecht (now Novonor) and state oil company Petrobras, implicating politicians and business elites in 12 countries. The operation recovered billions in fines. Yet the Brazilian Supreme Federal Court (STF) has since reversed key convictions and annulled critical evidence from Odebrecht’s leniency agreement, citing procedural flaws. Justice Dias Toffoli justified decisions by arguing that illegally obtained evidence cannot sustain convictions, while critics say he prioritizes technicalities over justice.

In May 2024, the STF overturned the corruption conviction of Marcelo Odebrecht, the former president of the construction company. The court has suspended over 100 cases tied to Odebrecht confessions in Brazil, including convictions of high-profile political figures like José Dirceu. A poll by AtlasIntel showed that six out of 10 Brazilians disagreed with Toffoli’s decisions to annul the Marcelo Odebrecht cases. Transparency International described Brazil as “exporting impunity,” a reversal from its earlier role as a leader in exposing corruption.

The perception of judicial politicization is profound. The World Justice Project ranks Brazil 138th globally for rule of law, just above Venezuela.

H. India: The Language of Caste in the Supreme Court

India’s Supreme Court has a progressive reputation on caste discrimination, but a 2025 Oxford-Harvard study found that “the court’s own language has frequently reflected the caste hierarchies it aims to erase”. Examining constitution bench rulings from 1950 to 2025, the researchers found that while landmark decisions often upheld Dalit rights, judicial language could be “demeaning or insensitive”. Some judgments likened caste oppression to disability, implying the oppressed are inherently inferior; others likened Dalits to “ordinary horses” in contrast to upper classes like “first class race horses”; still others described affirmative action as “crutches” Dalits should not depend on for too long. The study’s lead author said: “I think the judges were genuinely unaware of the implications of the language they were using, and what it revealed about their deeply held attitudes”.

One 2020 judgment talked about the “primitive way of life [of Scheduled Tribes] makes them unfit to put up with the mainstream” and described them as needing a “helping hand to uplift them”. The study concluded that such language “supported a bitterly unfair status quo” where oppressed castes remain trapped in reviled work.

The Congress Party has formally urged the Chief Justice of India “to take note of High Court judges who show ‘caste bias'” citing a specific case where a Dalit defendant was required to clean a police station as a condition of bail, a punishment that would never be imposed on an upper-caste defendant. The Supreme Court has recently addressed caste-based discrimination in prisons, directing the federal government to revise prison manuals to address caste-based discrimination, but the persistence of stigmatizing language remains a profound challenge.

I. South Africa: Ideological Faultlines in the Constitutional Court

South Africa’s Constitutional Court has been hailed as a model of transformative constitutionalism, but a 2026 analysis found that when justices interpret terms like “freedom,” “equality,” and “dignity,” “they are often doing so through a specific ideological framework”, producing systematically different outcomes in cases involving land reform, housing rights, and criminal procedure.

The most controversial recent case is AfriForum v Economic Freedom Fighters [2025] ZACC 4 (March 27, 2025), where the Constitutional Court dismissed AfriForum’s application for leave to appeal a ruling that the “Kill the Boer” chant, sung by EFF leader Julius Malema, did not constitute hate speech. The Court held: “The application should be dismissed as it bears no reasonable prospects of success”. The ruling upheld earlier decisions by the Equality Court (2022) and Supreme Court of Appeal (2024). AfriForum’s CEO accused the court of having “ideologically-driven judges”, while EFF MP Sinawo Thambo called the ruling “a victory for truth, for historical justice, and for the freedom to commemorate our fight against oppression”.

The case highlights how deeply subjective, and contested, constitutional interpretation can be. Also in 2025, the Constitutional Court dismissed an urgent application by former president Jacob Zuma and the MK party to invalidate President Ramaphosa’s appointment of an acting police minister and establishment of a commission of inquiry.

J. Israel: The Politicized Supreme Court

Israel’s Supreme Court has become a battlefield in the country’s constitutional crisis. In June 2025, the Cabinet resolved to amend the mechanism for terminating the Attorney General’s service, replacing the professional-public committee with a “ministerial committee” consisting solely of Cabinet members. A panel of seven justices ruled unanimously to strike down the Cabinet’s decision to dismiss Attorney General Gali Baharav-Miara, declaring the act “null and void” because the government did not abide “by its own mechanism established for dismissing the AG” adopted 25 years earlier.

The court has also ruled on petitions challenging Prime Minister Netanyahu’s authority to appoint the head of the Shin Bet domestic intelligence service, with right-wing ministers and lawmakers sharply criticizing the court as exceeding its authority. Alarmist rhetoric from critics claims that “activist justices” are undermining democracy. Attorney General Baharav-Miara warned that proposed judicial reforms would transform appointments into “a political selection mechanism,” undermining separation of powers and “eroding the core principles that define Israel as a democratic state”.

K. The Netherlands: The Salience Effect and Ethnic Bias

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Media coverage can amplify the ‘salience effect’, leading to unconsciously harsher sentences for specific demographics during high-publicity periods.

A remarkable natural experiment in the Netherlands demonstrates how media attention amplifies judicial bias. The 2019 murder of defense attorney Derk Wiersum by organized crime triggered intense media coverage focused, in part, on the Moroccan-Dutch background of suspects in that network.

Research by the University of Gothenburg, Vrije Universiteit Amsterdam, and Erasmus University Rotterdam found that in the weeks following the murder, Dutch judges imposed significantly harsher sentences on suspects of Moroccan descent, “averaging 71% longer, while sentences for others remained unchanged”. The effect persisted for months and disappeared only as media coverage subsided. Researchers attribute this to the “salience effect” : a psychological bias where judges unconsciously give greater weight to certain characteristics when they are highly publicized, meaning media coverage shapes judicial outcomes, in this case assigning disproportionate weight to ethnic background.

The study’s authors found that even judges with experience handling minority suspects were affected, though their bias was mitigated somewhat. Trouw, the Dutch newspaper that reported the findings, noted that judges and even the president of the Dutch judiciary “acknowledged that courts, too, can be sensitive to bias”.

IV. What Works? Evidence-Based Interventions

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Evidence-based interventions like blind scoring, separating decision-makers, and structured evaluations effectively mitigate judicial bias.

The research on debiasing has identified structural interventions that work. Blind scoring, removing irrelevant numerical anchor information from case files, reduces anchoring effects by eliminating the bias at source. Different judges for different decisions (having different judges decide detention and guilt) reduces confirmation bias. Structured evaluation requiring evidence checklists before final conclusions helps interrupt automatic pattern-matching. The “consider the opposite” strategy, requiring judges to generate reasons against their initial inclination, reduces anchoring effects.

Implicit bias training has mixed results; awareness is not behavior change. Judges have a “bias blind spot”: spotting biases in others but overconfident in controlling their own. The most promising interventions provide concrete behavioral strategies for real-time bias counteraction, not merely awareness.

Blinding, removing biasing information from the judicial environment, is consistently effective: removing prosecutor demands, redacting demographic details, and anonymizing judgments to reduce political bias.

V. Conclusion: Knowing the Mind, Designing the System

The psychology of judicial decisions is the psychology of human decisions. The science is not an indictment but an acknowledgment of humanity. The greatest obstacle to reform is the bias blind spot: judges believing they are uniquely immune. A judiciary that insists on perfect neutrality will resist reforms that would make it more neutral. The judge who begins each day by asking, “What biases might be affecting me today? What would the opposite conclusion look like?” has a chance of approaching impartiality.

Justice is not a state of mind; it is a set of procedures. The first of those procedures is humility: recognizing that the judicial mind, like all human minds, is a flawed instrument, and that the only path to justice is building systems that guard against the flaws we cannot eliminate.

Summary and List of Cited Cases

Case Name Jurisdiction Citation Year Description
Roe v. Wade United States 410 U.S. 113 1973 Established constitutional right to abortion using trimester framework; illustrates framing, anchoring, and ideological bias
Planned Parenthood v. Casey United States 505 U.S. 833 1992 Affirmed Roe‘s core holding; replaced trimester framework with undue burden test
Dobbs v. Jackson Women’s Health Organization United States 597 U.S. ___ 2022 Overturned Roe and Casey; illustrates motivated reasoning, confirmation bias, affect heuristic, hindsight bias, and political appointment bias
Presidential Election Petition Nigeria (2023) 2023 Supreme Court affirms Tinubu’s election, dismissing Atiku and Obi appeals
Lucy Connolly v. R. UK [2024] EWCA Crim 1102 2024 31-month sentence for inciting racial hatred on social media
R. v. Gladue Canada [1999] 1 S.C.R. 688 1999 Landmark requiring courts to consider Indigenous circumstances in sentencing
R. v. Ipeelee Canada [2012] 1 S.C.R. 433 2012 Clarifies Gladue, requires meaningful implementation of Gladue principles
R. v. Cope Canada 2024 NSCA 59 2024 Indigenous offender appeal; SCC heard in 2025 on Gladue application where victim is also Indigenous
R. v. Zoe Canada (2024) 2024 NTCA overturns dangerous offender designation after Gladue report
Englich & Mussweiler Germany (2001) study 2001 Classic anchoring study: 44 senior law students, random dice anchors affect sentencing
Combined Anchoring Study Germany pre-registered experiment 2021 475 law students: prosecution first anchor retains disproportionate influence
CZA19 v Commonwealth Australia [2025] HCA 8 2025 Asylum seekers’ detention upheld; narrow 5-4 split highlights judicial variability
Pearson v Commonwealth Australia [2024] HCA 46 2024 Immigration detention and visa cancellation case
Ismail v Minister Australia [2024] HCA 2 2024 Unanimous but reveals ideological assumptions about character-based visa cancellation
Plaintiff S15/2025 Australia (2025) 2025 Syrian refugee; non-refoulement obligations and “constructive refoulement”
NZYQ v Minister Australia (2023) 2023 Majority upholds deferral of protection claims to later application
Operation Car Wash decisions Brazil STF multiple rulings 2024-25 Toffoli-led reversal of key convictions; annulling evidence, suspending 100+ cases
Marcelo Odebrecht conviction overturned Brazil (2024) 2024 STF overturns conviction of construction giant’s former president
AfriForum v EFF South Africa [2025] ZACC 4 2025 Constitutional Court upholds “Kill the Boer” chant as not hate speech
Zuma v Ramaphosa South Africa (2025) 2025 ConCourt dismisses urgent application to invalidate presidential appointments
Shin Bet chief decision Israel (2025) 2025 Supreme Court rules on petitions challenging PM Netanyahu’s authority to appoint Shin Bet head
Attorney General dismissal case Israel (2025) 2025 Panel of 7 strikes down Cabinet decision to fire AG Baharav-Miara
Caste bias study India Oxford-Harvard (2025) 2025 75-year language analysis finds demeaning Dalit descriptions even in rights-affirming rulings
Salience effect study Netherlands Gothenburg/VU/Erasmus (2025) 2025 71% longer sentences for Moroccan-Dutch suspects after Wiersum murder; bias fades with media coverage
Electoral cycles study US 2024 2024 Dissent rate doubles (6%→12%) in quarter before presidential elections
Racial stereotypes study US Maltby/Matthews (2025) 2025 2005-2017 Supreme Court data: race-crime gap widens for defendants of color, especially conservative justices

Complete List of References

A. Cases (by jurisdiction)

Australia

  1. CZA19 v Commonwealth of Australia; DBD24 v Minister for Immigration [2025] HCA 8.
  2. Ismail v Minister for Immigration, Citizenship and Multicultural Affairs [2024] HCA 2.
  3. NZYQ v Minister for Immigration, Citizenship and Multicultural Affairs (2023) (unreported, High Court of Australia).
  4. Pearson v Commonwealth of Australia [2024] HCA 46.
  5. *Plaintiff S15/2025 v Minister for Immigration, Citizenship and Multicultural Affairs* (2025) (unreported, High Court of Australia).

Brazil

  1. Operation Car Wash (Lava Jato) decisions – Supreme Federal Court (STF), multiple rulings, 2024–2025.
  2. Marcelo Odebrecht conviction overturned – Supreme Federal Court (STF), 2024.

Canada

  1. R. v. Cope, 2024 NSCA 59.
  2. R. v. Gladue [1999] 1 S.C.R. 688.
  3. R. v. Ipeelee [2012] 1 S.C.R. 433.
  4. R. v. Zoe (2024) (unreported, Northwest Territories Court of Appeal).

Germany

  1. Combined Anchoring Study (experiment with 475 German law students) – pre-registered study, 2021. (See academic reference below for Englich & Mussweiler, 2001; combined study not separately published in peer-reviewed journal but described in the article.)

India

  1. Caste bias study – Oxford/Harvard analysis of Supreme Court language 1950–2025 (see academic reference below; no single case citation).

Israel

  1. Attorney General dismissal case (Gali Baharav-Miara) – Supreme Court of Israel, panel of seven justices, 2025.
  2. Shin Bet chief appointment case – Supreme Court of Israel, 2025.

Nigeria

  1. Presidential Election Petition (Atiku Abubakar & Peter Obi v. INEC & Bola Tinubu) – Supreme Court of Nigeria, 2023.

South Africa

  1. AfriForum v Economic Freedom Fighters [2025] ZACC 4 (Constitutional Court of South Africa).
  2. Zuma v Ramaphosa (2025) (unreported, Constitutional Court of South Africa).

United Kingdom

  1. Lucy Connolly v. R. [2024] EWCA Crim 1102 (England and Wales Court of Appeal).

United States

  1. Buck v. Davis, 580 U.S. ___ (2017).
  2. Dobbs v. Jackson Women’s Health Organization, 597 U.S. ___ (2022).
  3. Flowers v. Mississippi, 588 U.S. ___ (2019).
  4. Kimbrough v. United States, 552 U.S. 85 (2007).
  5. Louisiana v. Callais, 601 U.S. ___ (2025).
  6. McCleskey v. Kemp, 481 U.S. 279 (1987).
  7. Peña-Rodriguez v. Colorado, 580 U.S. ___ (2017).
  8. Planned Parenthood of Southeastern Pennsylvania v. Casey, 505 U.S. 833 (1992).
  9. Roe v. Wade, 410 U.S. 113 (1973).

B. Academic Articles and Studies

  1. Danziger, S., Levav, J., & Avnaim-Pesso, L. (2011). Extraneous factors in judicial decisions. Proceedings of the National Academy of Sciences, 108(17), 6889–6892.
  2. Englich, B., & Mussweiler, T. (2001). Sentencing under uncertainty: Anchoring effects in the courtroom. Journal of Applied Social Psychology, 31(7), 1535–1551.
  3. Englich, B., Mussweiler, T., & Strack, F. (2006). Playing dice with criminal sentences: The influence of irrelevant anchors on experts’ judicial decision making. Personality and Social Psychology Bulletin, 32(2), 188–200.
  4. Ghezelbash, D., Dorostkar, K., & Walsh, S. (2022). A data driven approach to evaluating and improving judicial decision-making: Statistical analysis of the judicial review of refugee cases in Australia. UNSW Law Journal, 45(3), 1085–1125.
  5. Guilfoyle, E., & Pina-Sánchez, J. (2025). Racially determined case characteristics: Exploring disparities in the use of sentencing factors in England and Wales. The British Journal of Criminology, 65(2), 241–260.
  6. Maltby, E., & Matthews, A. (2025). How Supreme Court justices use racial stereotypes when deciding cases. Legislative Studies Quarterly, published online. DOI: 10.1017/rep.2025.10010.
  7. Salience effect study (Netherlands) – University of Gothenburg, Vrije Universiteit Amsterdam, & Erasmus University Rotterdam (2025). Reported in Trouw newspaper; specific academic citation not provided in article.
  8. Electoral cycles study (US Courts of Appeals) – (2024). Specific authors and journal not provided in article; described as research on dissent rates before presidential elections.
  9. Pretrial detention confirmation bias study – (2018). Psychology, Crime & Law. Specific authors and volume not provided in article.

C. Reports, Official Documents, and Other Sources

  1. Policy and Legal Advocacy Centre (PLAC). (2025). Analysis of the 2023 Election Judgments in Nigeria. Abuja: PLAC.
  2. Re: Appointment of Justices (UK) – (2025). Report on judicial appointments in England and Wales (specific issuing body not provided in article).
  3. Transparency International. (2024–2025). Brazil: Exporting Impunity (report series).
  4. World Justice Project. (2025). Rule of Law Index 2025. Washington, D.C.: World Justice Project.
  5. Canadian Civil Liberties Association (CCLA). (2025). Intervenor submission in R. v. Cope (December 2025 hearing).

D. Books and General Background

  1. Kahneman, D. (2011). Thinking, Fast and Slow. New York: Farrar, Straus and Giroux. (Cited for System 1/System 2 framework.)
  2. The Cambridge Handbook of Psychology and Legal Decision-Making (chapter on hindsight bias) – specific editors and year not provided in article.

Note: Some references (e.g., the 2018 pretrial detention study, the 2024 electoral cycles study, the Netherlands salience effect study) are described in the article without full academic citations. The list above reproduces the information available from the article text. For a formal publication, those sources would need to be retrieved and cited in full.

Disclaimer: The information provided in this document is for general informational purposes only and should not be considered as professional advice.
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THE JURISDICTIONAL CONUNDRUM: ANALYSING THE DETENTION OF JUSTICE CRACK BY THE NIGERIAN ARMY https://1stattorneys.ng/articles/2026/05/03/the-jurisdictional-conundrum-analysing-the-detention-of-justice-crack-by-the-nigerian-army/ Sun, 03 May 2026 00:12:59 +0000 https://1stattorneys.com/articles/?p=990895

THE JURISDICTIONAL CONUNDRUM: ANALYSING THE DETENTION OF JUSTICE CRACK BY THE NIGERIAN ARMY

Abstract

The arrest and prolonged detention of Justice Mark Chidiebere, popularly known as “Justice Crack,” by the Nigerian Army in April 2026 has ignited a critical legal debate regarding military jurisdiction over civilians, the limits of free speech in the digital age, and the constitutional safeguards against arbitrary detention. This article examines the factual circumstances surrounding the detention, analyses the Nigerian Army’s legal justifications, evaluates the constitutionality of the detention under the 1999 Constitution, considers the applicability of the Armed Forces Act to civilians, and assesses the legal implications of prolonged detention. The article argues that while the Nigerian Army may have legitimate concerns regarding subversion, its detention of Justice Crack raises serious constitutional questions about military jurisdiction over civilians and the right to personal liberty.

1. INTRODUCTION

On 28 April 2026, Justice Mark Chidiebere, a prominent Abuja-based social media influencer and commentator who operates under the alias “Justice Crack,” left his home after receiving a telephone call and promptly disappeared from communication with his family. His mobile phones remained switched off, and his family and associates were unable to locate him for several days, prompting public outcry and concern.

On 2 May 2026, the Nigerian Army issued a statement confirming that Justice Crack was in its custody. The Army explained that the arrest arose from an investigation into social media posts wherein Justice Crack highlighted complaints made by soldiers regarding their feeding and general welfare conditions. According to the Army’s official statement, preliminary investigations suggested that Justice Crack was not merely reporting on welfare issues but was actively engaged in “inciting soldiers to create discontent within the system” and had chats “bordering on subversion” with the soldiers.

The Army further disclosed that Justice Crack was arrested alongside “some of the soldiers involved,” and while the soldiers remain in military custody, the influencer was transferred to “the relevant civil authorities for further investigation and possible prosecution.” The Army linked the arrest to an alleged “breach of the Armed Forces’ Social Media Policy” and attempts to “misinform the public,” while maintaining that its actions were “within legal limits” and that it “remains committed to the rule of law.”

This article critically examines the legal framework governing military detention of civilians in Nigeria, assesses the constitutionality of Justice Crack’s detention, and explores the broader implications for civil-military relations and fundamental rights protection in Nigeria’s democratic dispensation.

2. FACTUAL BACKGROUND

2.1 The Arrest and Initial Silence

Justice Crack’s disappearance on 28 April 2026 triggered immediate concern from his family. His wife reported that he had never stayed away from home without notice and that all attempts to reach him proved futile. The family’s alarm was compounded by the initial failure of any security agency to confirm his whereabouts, a situation that the Nigerian Army later addressed on 2 May 2026.

2.2 The Nigerian Army’s Statement

The Army’s statement, signed by Acting Director of Army Public Relations, Colonel Appolonia Anele, articulated three primary justifications for the arrest:

  1. Alleged Breach of Armed Forces’ Social Media Policy: Justice Crack was accused of violating internal military regulations governing social media conduct.
  2. Alleged Incitement: The Army claimed that Justice Crack “seemed to be inciting soldiers to create discontent within the system” and provided “an example was a chat bordering on subversion which Chidiebere had with the soldiers.”
  3. National Security Concerns: The Army argued that “a situation where civilians cultivate vulnerable personnel towards acts of subversion has far-reaching implications on discipline and national security.”

2.3 The Transfer to Civil Authorities

Importantly, the Army stated that Justice Crack “has been handed over to the relevant civil authorities for further investigation and possible prosecution,” while the soldiers involved “remain in own custody.” This distinction raises immediate questions: If the Army had legitimate jurisdiction to arrest and detain Justice Crack, why was he transferred to civil authorities? And if the transfer was necessary because military jurisdiction over civilians is limited, was the initial military detention itself lawful?

2.4 Family and Public Reaction

Justice Crack’s wife issued a public appeal: “Please Nigerian government, bring my husband back to me, back to my children. They need their father.” Human rights activist and publisher Omoyele Sowore called for Chidiebere’s release, alleging he was detained for speaking out on alleged abuses and the welfare of frontline soldiers.

3. THE CONSTITUTIONAL FRAMEWORK FOR PERSONAL LIBERTY

3.1 Section 35 of the 1999 Constitution

Section 35 of the 1999 Constitution guarantees personal liberty and mandates that detainees be brought before a court within a reasonable time.

The cornerstone of Nigeria’s protection against arbitrary detention is Section 35 of the 1999 Constitution (as amended). This provision guarantees the right to personal liberty and strictly circumscribes the circumstances under which a person may be deprived of that liberty. The relevant portions of Section 35 provide:

“(1) Every person shall be entitled to his personal liberty and no person shall be deprived of such liberty save in the following cases and in accordance with a procedure permitted by law:

(a) in execution of the sentence or order of a court in respect of a criminal offence of which he has been found guilty;

(b) by reason of his failure to comply with the order of a court or in order to secure the fulfilment of any obligation imposed upon him by law;

(c) for the purpose of bringing him before a court in execution of the order of a court or upon reasonable suspicion of his having committed a criminal offence, or to such extent as may be reasonably necessary to prevent his committing a criminal offence…”

3.2 Procedural Safeguards Under Section 35

Section 35 further provides critical procedural safeguards for any arrested or detained person:

  • Right to silence: The arrested person has the right to remain silent until after consultation with a legal practitioner.
  • Right to be informed: Any person arrested or detained shall be informed in writing within twenty-four hours (and in a language he understands) of the facts and grounds for his arrest or detention.
  • Right to be brought before a court: Any person arrested or detained upon reasonable suspicion of having committed a criminal offence shall be brought before a court of law within a reasonable time.

3.3 The Time Limit for Pre-Trial Detention

A constitutionally significant aspect of Section 35 is the proviso that “a person who is charged with an offence and who has been detained in lawful custody awaiting trial shall not continue to be kept in such detention for a period longer than the maximum period of imprisonment prescribed for the offence.” This provision, while aimed at preventing indefinite pre-trial detention, also underscores the constitutional expectation that detention must be promptly regularised by formal charges and court proceedings.

3.4 Application to Justice Crack’s Case

Applying Section 35 to Justice Crack’s situation, several constitutional questions emerge. First, does the initial arrest by military personnel fall within any of the permissible exceptions to personal liberty? Second, was Justice Crack informed in writing within twenty-four hours of the facts and grounds for his arrest? Third, was he brought before a court within a reasonable time? If the answer to any of these questions is negative, the detention would prima facie violate Section 35 of the Constitution.

4.1 The General Rule: No Military Jurisdiction Over Civilians

The Nigerian Army lacks legal jurisdiction to arrest and detain civilians like Justice Crack, as established in precedents like Ola v. Nigerian Army.

It is a well-established principle of Nigerian constitutional law that the military lacks jurisdiction to arrest and detain civilians except in very limited and exceptional circumstances. The Court of Appeal has affirmed this principle in Ola v. Nigerian Army [2010] 2 NWLR (Pt. 1179) 469, where the court ruled that the Nigerian Army has no right to detain a civilian and that doing so is unconstitutional.

This principle reflects the fundamental distinction between military law, which governs service personnel, and the general criminal law, which governs civilians. As one commentator observed during the military era, even when the Constitution was suspended, courts “never hesitated to order the release of several persons whose detention was found to be patently illegal.”

4.2 The Allatchi Precedent

The locus classicus on military detention of civilians in Nigeria is Ahmed Allatchi & 243 Others v. Chief of Army Staff & 4 Others (1993). In that case, 244 persons were arrested by soldiers and policemen between October 1991 and March 1992 and detained at various military facilities without being charged to court.

The High Court of Justice of Borno State, in a ruling delivered on 2 September 1993, declared:

“I think they can’t be arrested without been told or charged to Court of Law as provided by the Constitution of the Federal Republic of Nigeria under section 34 [now Section 35]. … The applicants do not fall under any of the exceptions. I think that their arrest and detention were both illegal, null and void.”

The court ordered the immediate release of all 244 applicants and perpetually restrained the respondents from deporting them. This case remains highly relevant to Justice Crack’s situation, as it explicitly holds that the military cannot arrest and detain civilians outside the constitutional exceptions.

4.3 The Conditions for Civilian Subjection to Military Law

Despite the general rule, there are limited circumstances under which a civilian may become subject to military law. Retired Major General Yusuf Shalangwa, a former Director of Legal Services of the Nigerian Army, has explained the two conditions under which civilians can be subject to court-martial under the Armed Forces Act:

“Condition one, such a civilian must have been employed or is an employee of a military establishment, a military department or unit. … The second condition is that it must have been during war or military operation. That’s why the Armed Forces Act says it must be during active service. Active service refers to when the military is engaged in serious military operations, like the Operation HADIN KAI and you committed an act which violates any of the provisions, any of the offences provided in part 12 of the Armed Forces Act, section 45 to 114 of the Armed Forces Act, such a civilian or journalist now becomes subject to the Act and can be tried by court martial…”

4.4 Application to Justice Crack

It is evident that Justice Crack does not satisfy either condition for civilian subjection to military law. He is not an employee of any military establishment, nor was he embedded with the military on any operational tour. His alleged activities occurred entirely online, as a civilian social media commentator, not during active service in a war or military operation.

Therefore, the Armed Forces Act should not apply to Justice Crack, and the Nigerian Army lacked the legal authority to arrest or detain him. The Army’s acknowledgment that he was “handed over to civil authorities” implicitly recognises this jurisdictional limitation, but it does not retroactively validate the initial military detention.

5.1 The Criminal Code Act

The Nigerian Army’s allegations against Justice Crack, incitement and subversion,find potential expression in the Criminal Code Act, which applies to civilians. The relevant provisions are:

Section 44: Inciting to Mutiny: This section provides that any person who advisedly attempts to incite any person serving in the Armed Forces of Nigeria to commit an act of mutiny or any traitorous or mutinous act is guilty of a felony and liable to imprisonment for life.

Section 45: Aiding and Inciting to Mutinous Acts or Disobedience: This section covers related acts of encouraging indiscipline among service members and carries a penalty of two years imprisonment and a fine.

5.2 The Distinction Between Advocacy and Incitement

ℹ
Discussing the welfare of security personnel is a matter of public interest protected under the constitutional right to freedom of expression, distinct from criminal incitement.

A critical legal distinction must be drawn between legitimate advocacy (or journalism) and criminal incitement. The Nigerian Army’s initial interest in Justice Crack arose from his social media posts “highlighting complaints by soldiers over feeding and welfare.” Reporting on poor conditions within the military, amplifying soldiers’ grievances, or criticising military leadership may be unpalatable to the authorities, but it does not necessarily constitute criminal incitement.

The Army alleged that Justice Crack “seemed to be inciting soldiers to create discontent within the system” and provided an example of “a chat bordering on subversion.” However, the specific content of this “chat” has not been publicly disclosed, nor has any evidence been presented to demonstrate that Justice Crack “advisedly” attempted to incite mutiny, as required by Section 44 of the Criminal Code.

The Rule of Law and Accountability Advocacy Centre (RULAAC) has argued that discussing the welfare of security personnel is a matter of public interest and falls under the constitutional right to freedom of expression, and that raising concerns about poor conditions or amplifying grievances should not be criminalised as “subversion” without clear and verifiable evidence.

5.3 The Armed Forces’ Social Media Policy: Internal Regulation, Not Law

ℹ
The Armed Forces’ Social Media Policy is an internal regulation binding only on military personnel and has no force of law over civilians.

A significant aspect of the Army’s justification is the alleged “breach of the Armed Forces’ Social Media Policy.” This raises a fundamental question: Does an internal military policy have the force of law applicable to civilians?

The answer is clearly no. The Armed Forces’ Social Media Policy is an internal administrative regulation binding only on military personnel as part of their service conditions. A civilian cannot be bound by an internal military directive, just as a private company cannot enforce its employee handbook on a non-employee. The mention of this policy as a justification for action against a civilian is legally untenable and suggests a misunderstanding (or deliberate misapplication) of the distinction between internal regulations and public laws.

6. THE PROLONGED DETENTION: CONSTITUTIONAL AND HUMAN RIGHTS IMPLICATIONS

6.1 The Right to a Fair Hearing Within Reasonable Time

Beyond the initial legality of the arrest, the prolonged nature of Justice Crack’s detention raises separate constitutional concerns. Section 35(4) of the Constitution requires that any person arrested or detained upon reasonable suspicion of having committed a criminal offence shall be brought before a court of law within a reasonable time.

What constitutes a “reasonable time” has been the subject of judicial interpretation, but it is generally understood to mean that the detainee must be charged and brought before a court within 24 to 48 hours, or as soon as practically possible given the circumstances. Prolonged detention without charge violates this constitutional guarantee.

Justice Crack’s family reported that he was unable to communicate with them for several days after his arrest, and his phones remained switched off. This raises concerns about incommunicado detention, which is prohibited by several international human rights instruments to which Nigeria is a party, including the African Charter on Human and Peoples’ Rights.

Section 35(2) of the Constitution guarantees the right of an arrested person to consult with a legal practitioner or any other person of his own choice. If Justice Crack was denied access to his family and legal representation, this would constitute an additional constitutional violation.

6.3 The Burden of Justification on the State

In all cases of detention, the burden of proving the legality of the detention rests on the detaining authority. In Ahmed Allatchi’s case, the court noted that the respondents (military authorities) had been served and were not in court to explain why the applicants were arrested and detained, and their counter-affidavit denied arresting and detaining the applicants. The court nonetheless declared the detention illegal.

The Nigerian Army’s statement that Justice Crack “has been handed over to the relevant civil authorities” suggests that he may no longer be in military custody. However, transfer to another agency does not cure the illegality of the initial detention, nor does it eliminate the constitutional requirement that he be charged or released within a reasonable time.

7. COMPARATIVE JURISPRUDENCE: LESSONS FROM THE MILITARY ERA

The current situation bears uncomfortable similarities to past episodes in Nigeria’s history when the military detained civilians without trial. Legal historian Femi Falana (himself a former detainee under the Buhari military regime) documented how, even during the military era, courts regularly ordered the release of illegally detained persons.

Notable cases from the Buhari military regime (1984-1985) include:

  • Lamina Lawal Arowoye & 6 Others v. Inspector-General of Police: The court declared the detention illegal on the grounds that the detention orders cited “acts prejudicial to public order” when the Decree required “acts prejudicial to State Security.”
  • Dr. Tai Solarin v. Inspector-General of Police & 2 Ors: The court ordered the immediate release of the applicant, holding that “the respondents have failed to discharge the onus placed on them to establish the legal justification for the detention of the Applicant.”
  • Maxwell Okudoh v. Commissioner of Police: Justice Oguntade (as he then was) held that the Chief of Staff could not detain for “acts prejudicial to public order” when the Decree specified other grounds, and ordered the applicant’s release.

These cases establish an important principle: even when detention is authorised by decree (let alone when it is not), courts will scrutinise the legality of detention and order release where the legal requirements are not strictly satisfied.

8. EVALUATION OF THE NIGERIAN ARMY’S POSITION

8.1 The Army’s Stated Justifications

The Nigerian Army’s position rests on several pillars:

  1. Jurisdiction: The Army claims the authority to arrest civilians for acts subversive to military discipline.
  2. Substantive Offence: Justice Crack is alleged to have committed acts bordering on subversion and incitement.
  3. Procedural Compliance: The Army claims to have acted “within the ambits of the law” and to have transferred Justice Crack to civil authorities.
⚠
Transferring a civilian detainee to civil authorities does not retroactively validate an initially unlawful military detention.

Each of these justifications is vulnerable to legal challenge:

On Jurisdiction: The weight of judicial authority, including Ola v. Nigerian Army and Ahmed Allatchi v. Chief of Army Staff, establishes that the military lacks jurisdiction to arrest and detain civilians outside the limited exceptions in the Armed Forces Act. Justice Crack does not fall within any of those exceptions.

On Substantive Offence: The constitutional right to freedom of expression protects political speech and commentary on matters of public interest. The line between protected speech and criminal incitement is a matter for judicial determination, not military flat. The Army’s reliance on an internal “Social Media Policy” as justification exposes the weakness of its substantive case.

On Procedural Compliance: Transferring a detainee to civil authorities does not retroactively validate military detention. If the initial arrest was unlawful, the fact of transfer does not cure the illegality. Moreover, the continued detention by civil authorities must satisfy constitutional requirements, including timely charge and court production.

9. CONCLUSION AND RECOMMENDATIONS

9.1 Summary of Findings

This analysis leads to the following conclusions:

  1. The Nigerian Army lacked legal jurisdiction to arrest and detain Justice Crack as a civilian, except in circumstances not present in this case. The general rule of Nigerian law is that military detention of civilians is unconstitutional.
  2. The Armed Forces’ Social Media Policy has no force of law over civilians and cannot justify the arrest or detention of a social media commentator.
  3. The prolonged detention raises serious constitutional concerns, particularly regarding Section 35 of the 1999 Constitution, which guarantees the right to personal liberty and requires timely charge and court production.
  4. The burden lies on the state to justify the detention, and the justifications offered to date appear legally insufficient.
  5. The circumstances of this case mirror historical episodes where Nigerian courts ordered the release of civilians illegally detained by the military, even during periods of military rule when fundamental rights were technically suspended.

9.2 Recommendations

✔
Civil authorities must either charge Justice Crack with a recognizable criminal offence before a competent court or release him immediately to comply with constitutional obligations.

Based on the foregoing analysis, the following recommendations are offered:

For the Nigerian Army:

  • Clarify the legal basis for its assertion of jurisdiction over civilians in this case.
  • Avoid reliance on internal policies (such as the Social Media Policy) as justifications for actions against civilians.
  • Ensure that any future actions against civilians strictly comply with constitutional limitations on military jurisdiction.

For the Civil Authorities:

  • If Justice Crack is in their custody, they are constitutionally obliged to either charge him with a recognisable criminal offence before a court of competent jurisdiction or release him immediately.
  • The continued detention of Justice Crack without charge violates Section 35 of the Constitution.

For the Judiciary:

  • Should an application for enforcement of fundamental rights be brought, the courts must assert their constitutional role as guardians of personal liberty, as they have done in previous cases such as Ahmed Allatchi and the military-era cases documented by Falana.

For Civil Society and the Legal Community:

  • Create awareness on citizen’s fundamental rights.
  • Advocate for clearer legislative and policy guidance on the limits of military jurisdiction over civilians in counter-terrorism and internal security operations.

For the National Assembly:

  • Consider legislative action to clarify the scope of military jurisdiction over civilians, ensuring that such jurisdiction is strictly limited and subject to judicial oversight.

10. POSTSCRIPT

At the time of writing, Justice Crack remains in the custody of “relevant civil authorities” according to the Nigerian Army’s statement. His family reports that he has been unable to communicate with them. The coming days will be critical in determining whether he will be formally charged in a civilian court or released.

The case of Justice Crack is not merely about one individual. It is a test of Nigeria’s commitment to constitutionalism, the rule of law, and the protection of fundamental rights in an era of expanding security operations and securitised responses to online speech. The Nigerian courts have historically risen to the occasion when fundamental rights are threatened. Whether they will do so again remains to be seen.

REFERENCES

  1. Constitution of the Federal Republic of Nigeria, 1999 (as amended)
  2. Criminal Code Act, Cap C38, Laws of the Federation of Nigeria, 2004
  3. Armed Forces Act, Cap A20, Laws of the Federation of Nigeria, 2004
  4. Ahmed Allatchi & 243 Ors v. Chief of Army Staff & 4 Ors (1993) (Unreported) Borno State High Court
  5. Ola v. Nigerian Army [2010] 2 NWLR (Pt. 1179) 469
  6. African Charter on Human and Peoples’ Rights (Ratification and Enforcement) Act, Cap A9, Laws of the Federation of Nigeria, 2004
  7. Fundamental Rights (Enforcement Procedure) Rules, 2009

This article is provided for academic and informational purposes and does not constitute legal advice. Persons seeking legal redress should consult a qualified legal practitioner.

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How to Open a Company and Bank Account in Nigeria: A Guide for Russian Investors https://1stattorneys.ng/articles/2026/04/29/russia-bank-account-in-nigeria/ Wed, 29 Apr 2026 10:44:30 +0000 https://1stattorneys.com/articles/?p=990854
Регистрация компании и открытие банковского счета в Нигерии: руководство для россиян

Регистрация компании и открытие банковского счета в Нигерии: руководство для россиян

В последние годы Нигерия становится привлекательным направлением для международных инвесторов благодаря своему быстрорастущему рынку, молодому населению и разнообразным экономическим возможностям. Для российских предпринимателей, ищущих выход на африканские рынки, Нигерия может стать отличной стартовой площадкой. В этом материале мы расскажем, как зарегистрировать компанию и открыть банковский счёт в Нигерии.

Почему Нигерия?

ℹ
Нигерия является крупнейшей экономикой Африки и входит в зону свободной торговли AfCFTA, что делает её отличным хабом для экспансии на континент.

Нигерия; крупнейшая экономика Африки по ВВП и численности населения (более 200 миллионов человек). Страна активно привлекает иностранных инвесторов, особенно в сферах:

  • Финансовых технологий
  • Агробизнеса
  • Энергетики и нефти
  • Недвижимости
  • Образования и медицинских услуг

Кроме того, Нигерия входит в Африканскую континентальную зону свободной торговли (AfCFTA), что делает её важным хабом для экспансии на весь африканский рынок.

Регистрация компании в Нигерии: пошаговая инструкция

✔
Для иностранных инвесторов наиболее предпочтительной формой ведения бизнеса является общество с ограниченной ответственностью (LLC).
  1. Выбор структуры компании
    Иностранные инвесторы чаще всего создают общество с ограниченной ответственностью (LLC).
  2. Резервирование имени компании
    Через электронную платформу Комиссии по корпоративным делам (Corporate Affairs Commission, CAC) можно зарезервировать уникальное имя компании.
  3. Подача регистрационных документов
    Необходимые документы:
    • Устав и учредительный договор
    • Удостоверения личности акционеров и директоров
    • Юридический адрес в Нигерии
  4. Получение регистрационного сертификата
    После утверждения документов выдается Сертификат регистрации компании.

Открытие банковского счета

После регистрации компании следующим этапом является открытие корпоративного банковского счета. Для этого потребуется:

  • Регистрационные документы компании
  • Идентификационные документы акционеров и директоров
  • Налоговый номер (Tax Identification Number, TIN)
  • Utility bill или арендный договор офиса в Нигерии

Большинство крупных банков Нигерии (Access Bank, Zenith Bank, GTBank и др.) имеют англоязычный персонал и онлайн-платформы, упрощающие работу с иностранцами.

Полезные советы

⚠
Необходимо внимательно следить за валютным регулированием, так как Нигерия контролирует отток валюты, что влияет на репатриацию прибыли.
✔
Рекомендуется нанимать локального консультанта для ускорения процесса регистрации и избежания юридических ошибок.
  • Нанимайте локального консультанта: работа с местным юристом или агентом ускорит процесс и поможет избежать ошибок.
  • Убедитесь, что банк работает с иностранными инвесторами: не все банки открывают счета без физического присутствия.
  • Следите за валютным регулированием: Нигерия контролирует отток валюты, поэтому важно понимать правила репатриации прибыли.

Заключение

Регистрация компании и открытие банковского счета в Нигерии, вполне осуществимый процесс для россиян при наличии правильной информации и поддержки. Выход на нигерийский рынок может стать важным шагом в международной экспансии и источником значительной прибыли.

Для получения более подробной информации и списка рекомендованных экспертов, обратитесь к видео:

Need expert guidance on this topic?

References & Citations

AfCFTA
source

Африканская континентальная зона свободной торговли

CAC
source

Corporate Affairs Commission (Комиссия по корпоративным делам)

Банки Нигерии
source

Access Bank, Zenith Bank, GTBank

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Mastering Fee Negotiation: A Detailed Guide for Nigerian Lawyers https://1stattorneys.ng/articles/2026/04/29/mastering-fee-negotiation/ Tue, 28 Apr 2026 23:25:41 +0000 https://1stattorneys.com/articles/?p=990842

Mastering Fee Negotiation: A Detailed Guide for Nigerian Lawyers

Negotiating legal fees is one of the most challenging yet essential skills for any lawyer in Nigeria. Many advocates, particularly young and mid-level practitioners, struggle with fee discussions, often accepting below-market rates because they lack confidence, preparation, or a structured approach. The Legal Practitioners Remuneration Order (LPRO) 2023 has provided a statutory floor, but knowing the minimum is not enough. You must also know how to negotiate effectively to achieve fees that reflect your expertise, effort, and value.

This article provides a comprehensive, step‑by‑step guide on developing and applying negotiation skills specifically for legal fee discussions in the Nigerian context. Whether you are a sole practitioner in a Band 2 state or a partner in a Lagos commercial firm, these techniques will help you command higher fees, build stronger client relationships, and avoid the trap of undercharging.

Part 1: The Mindset: Overcoming the Internal Barriers to Negotiation

Before any negotiation begins, the most important battle is internal. Many Nigerian lawyers undervalue themselves due to a culture of “begging for work,” fear of losing the client, or a misplaced belief that discussing money is unprofessional.

How to reframe your mindset:

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Charging below the prescribed minimum under the LPRO is professional misconduct. Negotiating upwards is compliance with ethical standards.
  1. Recognise that fee negotiation is a professional duty, not a favour. Under the LPRO, charging below the prescribed minimum is professional misconduct. Negotiating upwards from the minimum is not greedy, it is compliance with ethical standards and a commitment to the profession’s sustainability.
  2. Internalise your value proposition. Ask yourself: What specific results have I achieved for past clients? What expertise do I bring that a general practitioner does not? How much time, stress, or money do I save the client? Write down three concrete value statements. For example: “In the last year, I resolved three similar disputes without going to trial, saving clients an average of ₦2 million in litigation costs.”
  3. Separate your self‑worth from the negotiation. A client’s refusal to pay your quoted fee is not a personal rejection. It may reflect their budget constraints, lack of understanding of legal value, or attempt to test your boundaries. Your job is to educate and persuade, not to beg or apologise.
  4. Use the LPRO as your shield and sword. When a client pushes for a lower fee, you can confidently say: “I am bound by the Legal Practitioners Remuneration Order 2023, which prescribes a minimum fee of ₦X for this service. I cannot legally accept less. However, I can structure the fee differently, for example, as a retainer or stage‑based payments, while respecting the minimum.”

Part 2: Pre‑Negotiation Preparation: The Foundation of Every Successful Fee Discussion

Preparation is where most lawyers fail. They walk into a fee conversation cold, hoping the client will accept whatever number comes to mind. This is a recipe for undervaluation.

Step 1: Know your minimum and your target

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Always prepare your minimum, target, and walk-away point before entering a fee discussion.
  • Minimum: The absolute floor under the LPRO, adjusted for your PQE tier and the client’s state band. Calculate this precisely before the meeting.
  • Target: The fee you genuinely want. Typically 20–50% above the minimum, depending on complexity, urgency, and your unique expertise.
  • Walk‑away point: The point below which you will decline the engagement (which must be at or above the LPRO minimum). Be prepared to say “I’m sorry, but I cannot accept that fee. I wish you the best in finding another lawyer.”

Example:
For a company incorporation in Lagos (Band 3), a lawyer with 3 years PQE has an LPRO minimum of ₦100,000. Their target might be ₦150,000. Their walk‑away is ₦100,000, they cannot legally go lower, so any offer below that ends the negotiation.

Step 2: Research the client and the matter

  • Client’s profile: Is this an individual, a small business, or a multinational corporation? What is their likely budget? Have they used lawyers before, and at what rates?
  • Complexity and risk: Does the matter involve novel legal issues, tight deadlines, regulatory filings, or potential liability for you? Adjust your target upward accordingly.
  • Urgency: If the client needs the work done in 48 hours, you have significant leverage. Charge a premium for expedited service.

Step 3: Prepare your value narrative and evidence

Do not simply state a number. Prepare a short, factual justification:

  • Breakdown of tasks: “This matter will require 8 hours of research, 4 court appearances, and 3 rounds of document drafting.”
  • Past results: “In a similar case last year, I obtained a judgment of ₦5 million for my client.”
  • Efficiency gains: “Because I have handled 20 similar incorporations, I can complete yours in 5 days instead of the typical 14 days.”

Pro tip: Bring a one‑page “fee proposal” that lists the service, the LPRO minimum (cite the specific schedule), your quoted fee, and a brief value statement. This document signals professionalism and reduces haggling.

Step 4: Define your BATNA (Best Alternative to a Negotiated Agreement)

  • What will you do if the client refuses your fee? Work on another matter? Refer the client elsewhere? Reduce your scope?
  • A strong BATNA gives you confidence. For example: “If we cannot agree, I have three other prospective clients seeking similar services this week. I would still be happy to recommend another lawyer who charges within your budget.”

Part 3: The Negotiation Conversation: Techniques and Scripts

Fee negotiation is not a confrontation; it is a collaborative problem‑solving discussion aimed at finding an arrangement that works for both parties. The following techniques are proven to increase success rates.

Technique 1: Anchor High but Credibly

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Anchor high but credibly; the first number mentioned sets the reference point for the entire negotiation.

The first number mentioned in a negotiation sets the “anchor”, the reference point around which all subsequent discussion revolves. Always anchor at or slightly above your target.

How to do it:
“Based on the LPRO minimum for this service and the complexity of your matter, my professional fee is ₦250,000.” (Even if you would accept ₦200,000.)

Why it works: Psychological studies show that final settlements tend to cluster near the initial anchor. If you start low, you will end lower.

Technique 2: Use the “Flinch”: React Visibly to a Low Offer

When a client proposes a fee below your minimum or far below your target, show surprise, not anger, but mild, genuine surprise. A slight pause, raised eyebrows, or a soft “Hmm, that’s much lower than I was expecting” can make the client reconsider without you having to argue.

Script:
Client: “I can only pay ₦50,000.”
You (with a gentle flinch): “Oh. That’s significantly below the statutory minimum of ₦100,000 for this service. I’m afraid I can’t do that. But perhaps we can look at a reduced scope of work?”

Technique 3: Ladder of Concessions: Give Value, Not Discounts

If you must move from your initial anchor, do so in small, graduated steps. And never give a concession without asking for something in return (e.g., faster payment, a referral, or a longer retainer).

Example of poor concession:
“Okay, I’ll reduce the fee to ₦200,000.” (No return asked.)

Example of smart concession:
“I can reduce the fee to ₦220,000 if you pay 80% upfront and refer one other client to me within the next month.”

The concession ladder rule: If you start at ₦250,000, your next offer might be ₦230,000, then ₦215,000, then ₦200,000. Avoid dropping by more than 10–15% at a time, and never make a concession without one from the other side.

Technique 4: Silence: The Most Underused Tool

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Use silence as a tool after stating your fee or responding to an objection to create pressure and encourage concessions.

After stating your fee or responding to an objection, stop talking. Count to ten in your head if necessary. Silence creates pressure. The next person to speak often concedes.

Example:
You: “My fee is ₦150,000.”
Client: “That’s too high. I was thinking ₦80,000.”
You: (Pause for 5–7 seconds, maintaining eye contact calmly.)
Client (often feeling uncomfortable): “…Well, maybe I can go to ₦100,000.”

Technique 5: The “Columbo”: Ask Questions to Uncover Interests

Instead of arguing, ask open‑ended questions that reveal the client’s true constraints and priorities. This allows you to propose creative solutions.

Questions to ask:

  • “Help me understand, what budget did you have in mind for this matter, and how did you arrive at that figure?”
  • “Aside from cost, what else is important to you in this engagement? Speed? Confidentiality? Direct access to me as the lead lawyer?”
  • “If we could structure the payments over three months instead of one, would that make my fee workable for you?”

Technique 6: Split the Difference: The Classic Close

When you and the client are close but not yet agreed, a fair split can break the deadlock. Use this only near the end of the negotiation.

Script:
“We are ₦40,000 apart. Let’s split the difference: ₦20,000 each. That means a total fee of ₦170,000. Do we have a deal?”

Technique 7: The Nibble: Asking for Small Extras After Agreement

After the client agrees to your fee, “nibble” a small extra concession that costs you little but adds value. This trains the client to see you as a tough but fair negotiator.

Example:
“Great. And since we have agreed on the fee, would you be willing to sign a two‑month retainer at the same rate, so we don’t have to renegotiate for follow‑up work?”

Objection 1: “I don’t have that kind of money.”

Response: “I understand budget constraints. Let me share two options. Option A: We reduce the scope, for example, only the initial consultation and a demand letter for ₦X (still above LPRO minimum). Option B: You pay 50% now and the remainder in 30‑day instalments. Which works better for you?”

What to avoid: Immediately dropping your fee. Always offer value‑preserving alternatives first.

Objection 2: “But Lawyer X down the street charges half your rate.”

Response (calmly): “I cannot speak for others. However, the LPRO sets a minimum fee for this service, and I comply with it. What I can tell you is that my approach includes [list unique benefits: faster turnaround, specialisation, past results]. If you prefer a lower‑cost option, I respect that, but I would urge you to confirm that the other lawyer is charging in compliance with the law.”

Objection 3: “This is a simple matter. Why should I pay so much?”

Response: “I appreciate that. However, even ‘simple’ matters require professional skill to avoid costly mistakes. For example, one missed filing deadline or an improperly drafted clause could cost you ten times my fee in court or lost business. My fee reflects not just the time but the insurance against those risks.”

Objection 4: “I’ll pay you after the case is won.”

Response: “I understand the preference for contingent fees. Under the Rules of Professional Conduct, contingency fees are allowed only in civil matters and must be in writing. I can offer a hybrid: 30% upfront, and the balance as a percentage of the recovery, capped at a reasonable amount. Would you like me to draft a proposed agreement?”

Do not: Accept 100% contingency without upfront payment, unless the case is very strong and the client is impecunious but has a clear path to recovery. Even then, be cautious.

Part 5: Negotiating Different Fee Structures (Beyond Simple Fixed Fees)

Sometimes the best negotiation is not about the total amount but about how and when you are paid. Use these structures to bridge gaps.

Structure

How to Negotiate It

Hourly with cap

“I propose ₦50,000/hour, but I will cap my total fees at ₦500,000 unless we both agree to extend the scope.”

Monthly retainer

“Instead of a fixed fee for this single matter, consider a 6‑month retainer of ₦200,000/month. That covers all advisory and up to 10 court appearances. Any additional time is billed at ₦40,000/hour.”

Stage payments

“We break the litigation into four stages: filing (₦150,000), pre‑trial (₦200,000), trial (₦300,000 per week), and appeal (₦400,000). You pay only as we progress.”

Hybrid (fixed + contingency)

“I will charge a reduced fixed fee of ₦100,000, and if we secure a judgment above ₦2 million, I receive 10% of the excess.”

Value‑based (percentage of transaction)

“For this merger, I charge 1% of the transaction value, capped at ₦5 million. That aligns my interests with yours , I only do well if the deal closes successfully.”

Part 6: Special Scenarios: Negotiation Tactics for Different Career Stages

For Young Lawyers (1, 9 PQE)

Challenge: Lack of reputation; clients often assume you are desperate.

Tactics:

  • Use the “supervised by senior” card: “I am working under the supervision of [Senior Partner/SAN]. The fee reflects both my work and their oversight.”
  • Bundle services: Offer a “startup legal package” (incorporation, trademark, standard agreements) at a total price that is attractive but still above LPRO minima for each component.
  • Emphasise responsiveness: “Large firms may take 5 days to respond. I commit to replying within 4 hours on weekdays. That speed has value.”

For Experienced Lawyers (10+ PQE)

Challenge: Clients may try to “commoditise” your services, comparing you to younger lawyers.

Tactics:

  • Anchor with precedent: “Last month, I handled a similar matter for [Client X] at ₦500,000. That is my current rate.”
  • Sell efficiency and judgement: “Yes, a junior lawyer could draft this for less. But they would take 20 hours and likely miss two issues. I will take 6 hours and deliver a cleaner product. The total cost to you is actually lower with me.”
  • Use BATNA confidently: You have a full practice. Do not hesitate to say no to low offers.

For Senior Advocates and Law Firm Partners

Challenge: Managing multiple fee negotiations simultaneously; protecting firm margins.

Tactics:

  • Delegate the opening negotiation to a junior partner, it allows you to preserve your relationship capital and “step in” only to close the deal, often at a higher fee.
  • Require a “capability statement” and a “fee schedule” before the meeting, this pre‑qualifies the client and reduces in‑meeting haggling.
  • Offer “tiered service levels”: Gold (partner‑led, 24‑hour response), Silver (senior associate‑led, 48‑hour response), Bronze (junior associate‑led with partner review). Each tier has a different price.

Part 7: Closing and Documenting the Agreement

A negotiation is not complete until the terms are documented in a legally binding engagement letter, as required by the LPRO.

How to close effectively:

  1. Summarise the agreement aloud: “So we have agreed on a fixed fee of ₦180,000, plus VAT of 7.5%, with 50% payable upfront and the balance upon filing the defence. No additional court appearance fees. Is that correct?”
  2. Set a specific next step: “I will send you the engagement letter by email within one hour. Please sign and return it before [date], and transfer the upfront payment to the account details in the letter. Once I receive both, I will start work.”
  3. Avoid the “post‑negotiation regret”: Some clients will try to reopen negotiations after the meeting. Prevent this by stating in the engagement letter: “This fee agreement is final and may only be amended in writing signed by both parties.”

What the engagement letter must include (under the LPRO and RPC):

Document the final agreement in a legally binding engagement letter as required by the LPRO and RPC.
  • Full names and addresses of both parties
  • Scope of services (with enough specificity to prevent scope creep)
  • Fee structure (fixed, hourly, retainer, or contingency)
  • Minimum fee (if scale‑based) and justification if above minimum
  • Billing and payment schedule
  • VAT and WHT provisions
  • Dispute resolution clause (e.g., arbitration or NBA mediation)
  • Signature and date lines

Part 8: Role‑Play Scenarios: Putting It All Together

Scenario 1: Young Lawyer vs. Small Business Owner (Incorporation)

Client: “I need to register a business name. How much?”

Young lawyer (prepared): “Under the Legal Practitioners Remuneration Order, the minimum fee for a business name registration for a lawyer with my experience in Lagos is ₦50,000. However, given that your business will need additional services like a tax identification number and a standard term of service document, I would recommend our ‘Startup Bundle’ for ₦120,000, which includes all three.”

Client: “That’s too high. I have a friend who is a lawyer and he said ₦30,000.”

Lawyer (calm, uses flinch): “I see. ₦30,000 is actually below the statutory minimum, so I cannot ethically match that. But let me ask, are the TIN registration and terms of service important to you, or would you prefer just the business name registration at the minimum of ₦50,000?”

Client: “I need the TIN as well.”

Lawyer: “Then let me offer this: You pay ₦50,000 upfront for the business registration and TIN, and we will draft the terms of service for an additional ₦30,000, but only after you have signed a retainer for future advisory at ₦50,000 per month. That way you spread the cost and get ongoing support.”

Scenario 2: Experienced Lawyer vs. Corporate Client (Contract Drafting)

Client (in‑house counsel): “We need a 30‑page distribution agreement. Our budget is ₦150,000.”

Lawyer (10 PQE, Band 3): “Thank you for considering me. The LPRO minimum for a commercial contract of this complexity for a lawyer with my experience is ₦250,000. That includes two rounds of revisions and a legal opinion. I understand budgets are tight, could we instead agree on a fixed fee of ₦200,000 for a single draft and one round of revisions, with additional work billed at ₦50,000/hour?”

Client: “We really can’t go above ₦180,000.”

Lawyer (uses split‑the‑difference): “We are ₦20,000 apart. Let’s split it: ₦190,000, with payment within 7 days of delivery. Do we have a deal?”

Client: “Agreed.”

Scenario 3: SAN vs. High‑Net‑Worth Individual (Debt Recovery)

Client: “I am owed ₦50 million. I want you to handle it. What will you charge?”

SAN: “For a debt recovery of this size, I typically charge a fixed fee of ₦3 million plus 5% of any amount recovered above ₦50 million, capped at ₦5 million. That structure means you pay nothing extra if we recover exactly the principal, but I am incentivised to get you more.”

Client: “That seems high. I have seen other SANs charge 2% of the principal.”

SAN: “I understand. My approach includes direct involvement by me in all court appearances, a senior associate dedicated to your file, and a guarantee of a first‑instance judgment within 9 months or I reduce my fee by 20%. Those other SANs may delegate to juniors and take longer. Which outcome do you value more, a lower upfront cost or a faster, higher‑probability recovery?”

Client (after pause): “The faster recovery. But can you do ₦2.5 million fixed, plus 4% of excess?”

SAN: “I can do ₦2.7 million and 4.5%. That is my final offer.”

Client: “Deal.”

Part 9: Ethical Boundaries in Fee Negotiation

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Contingency fees are strictly prohibited in criminal matters and must always be in writing for civil matters.

Negotiation skills must never cross into unethical territory. The following are prohibited:

  • Charging below the LPRO minimum for any service covered by the Order.
  • Misleading the client about the applicability of the LPRO (e.g., claiming a fee is mandatory when it is not).
  • Using a contingency fee in a criminal matter, it is absolutely forbidden.
  • Charging a fee that is manifestly excessive even if above the minimum. Reasonableness factors include the time, difficulty, results obtained, and customary local fees.
  • Failing to provide a written engagement letter within 14 days of instruction.
  • Threatening to withdraw from a case solely over a fee dispute in a manner that would prejudice the client’s position (e.g., on the eve of trial). Withdrawal must follow the RPC rules.

If you are ever unsure, contact the NBA Remuneration Committee or your branch’s ethics committee before finalising the agreement.

Part 10: Continuous Improvement: How to Become a Master Negotiator

Negotiation is a skill, not a talent. You can improve systematically:

  1. Record your negotiations (with client consent) and review them. What did you say? When did you concede? What objections arose that you could have handled better?
  2. Role‑play with colleagues. Spend 15 minutes each week taking turns playing a difficult client. Practice saying “no” calmly.
  3. Learn from lost negotiations. When a client walks away, politely ask: “Would you be willing to share what fee you ultimately agreed with another lawyer, and what made that arrangement more attractive?” This is market intelligence.
  4. Read one negotiation book per year. Start with Getting to Yes (Fisher & Ury) or Never Split the Difference (Chris Voss). Adapt the techniques to the Nigerian legal context.
  5. Get feedback from clients after the engagement. Not about legal work but about the fee process: “Was our fee discussion clear and fair? What would you change?”
  6. Track your metrics. For one month, record: number of fee proposals made, number accepted, average discount from initial anchor, and total fee income. Over six months, aim to reduce your average discount by 5% and increase your acceptance rate of target fees.

Conclusion: Negotiation is Service, Not Confrontation

The best negotiators in the Nigerian legal profession are not the loudest or most aggressive; they are the most prepared, empathetic, and principled. Every fee negotiation is an opportunity to educate the client about the value of legal services, to set professional standards for the entire bar, and to build a sustainable practice that rewards excellence.

Remember: the LPRO is your ally, not a restriction. Use it to anchor your fees with legal authority. Prepare relentlessly. Master the techniques of anchoring, flinching, silence, and concession trading. Handle objections with grace and creativity. And always, always document the final agreement in a compliant engagement letter.

With practice, you will not only earn what you deserve, you will elevate the entire profession’s perception of the worth of a lawyer’s work. Negotiate not with fear, but with confidence. The law is on your side.

References:

  • Legal Practitioners Act, Cap L11, Laws of the Federation of Nigeria, 2004. The foundational legislation for the legal profession in Nigeria, providing the statutory authority for regulating legal practitioners’ remuneration under Section 15(3).
  • Legal Practitioners (Remuneration for Business, Legal Services, and Representation) Order, 2023 (LPRO). The central piece of legislation on legal fees, passed on 16 May 2023. It sets mandatory minimum fee scales that vary based on a lawyer’s years of post-call experience (PQE) and the economic classification of the state.
  • Rules of Professional Conduct for Legal Practitioners, 2023 (RPC). Made on 6 June 2023, and effective from 1 January 2024, these rules govern ethical standards. Key provisions relevant to fees are found in Rules 9, 11, 12, and 49, which cover retainer agreements, remuneration, and professional duties.
  • Nigeria Tax Act, 2025 (NTA). Signed into law on 26 June 2025, this is the primary legislation for Nigeria’s tax regime, effective from 1 January 2026. It consolidates multiple tax statutes, and its provisions on professional services are codified in Chapters Six (sections 144-158), Eight (Part IV), and Nine.
  • Nigeria Tax Administration Act, 2025 (NTAA). Enacted on 26 June 2025 and effective from 1 January 2026, this Act provides the administrative framework and procedures for implementing tax laws, including compliance and dispute resolution.
  • Nigeria Revenue Service (Establishment) Act, 2025 (NRSA). Came into force on 26 June 2025, establishing a new revenue service to replace the FIRS for tax collection and management.
  • Joint Revenue Board (Establishment) Act, 2025 (JRBA). Came into force on 26 June 2025, creating a Joint Revenue Board to harmonise tax policies and administration among federal and state tax authorities.

Additional Statutory and Tax Legislation

  • Evidence Act, Cap E14, Laws of the Federation of Nigeria, 2011. Governs the admissibility of evidence in legal proceedings, including the requirement that documents be properly stamped to be admissible.
  • Sheriffs and Civil Process Act, Cap S6, Laws of the Federation of Nigeria, 2004. Provides the procedure for enforcing money judgments, a core legal service for which lawyers charge fees.
  • Companies Income Tax Act (CITA), Cap C21, LFN 2004 (as amended). Its provisions on income tax are now largely consolidated into the Nigeria Tax Act (NTA) 2025.

Institutional, Compliance, and Disciplinary Bodies

  • Nigerian Bar Association (NBA). The NBA is actively involved in ensuring fee compliance through its Remuneration Committee, which oversees the implementation of the LPRO 2023.
  • Legal Practitioners Disciplinary Committee (LPDC). This body hears petitions and imposes sanctions, including suspension or striking a lawyer’s name from the Roll, for acts of professional misconduct such as charging fees below the LPRO minimum.
  • Nigeria Revenue Service (NRS). This newly established body replaces the Federal Inland Revenue Service (FIRS) and is responsible for assessing, collecting, and accounting for taxes and other revenues due to the Federation.

Secondary Literature on Negotiation

  • Fisher, R., Ury, W., & Patton, B. (2011). Getting to Yes: Negotiating Agreement Without Giving In (3rd ed.). Penguin Books. A seminal text introducing “principled negotiation” (separating people from the problem, focusing on interests vs. positions, generating options for mutual gain, using objective criteria). These principles are directly applicable to value-based fee negotiations in legal practice.
  • Voss, C., & Raz, T. (2016). Never Split the Difference: Negotiating As If Your Life Depended On It. Harper Business. Written by a former FBI hostage negotiator, this book provides actionable tactics such as tactical empathy, mirroring, labelling, calibrated questions, and the use of silence. These tools are highly effective in the specific, high-stakes context of legal fee discussions
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The Illusion of Democracy https://1stattorneys.ng/articles/2026/04/28/the-illusion-of-democracy/ Tue, 28 Apr 2026 17:52:50 +0000 https://1stattorneys.com/articles/?p=990832

The Illusion of Democracy: A Holistic Examination of What Democracy Promises, Why It Fails to Deliver, and Whether Any System Can Do Better

Introduction: The Great Political Mirage

Democracy in its contemporary form often functions as a ritualized performance, masking the reality of rule by unelected economic elites and unaccountable state apparatuses.

The word “democracy” carries immense moral weight, evoking images of citizens freely choosing their leaders and a system where every voice matters. Since the fall of the Berlin Wall, it has been presented as the only legitimate form of government, the “end of history”. Across the globe, nations proudly maintain the formal architecture of representative government, yet beneath this surface, the substance of democratic governance, accountability, popular sovereignty, and genuine political equality, is often hollowed out while the forms remain intact.

This is the illusion of democracy: a system that looks and sounds democratic yet systematically denies citizens meaningful control over the decisions that shape their lives. Democracy in its contemporary form has become a ritualized performance, a carefully maintained facade that masks the reality of rule by unelected economic elites, entrenched political dynasties, and unaccountable state apparatuses. This condition is global, manifesting as a “third wave of autocratization” characterized by gradual setbacks under a legal façade. Understanding this phenomenon requires deconstructing what democracy is supposed to be and why it fails to manifest in practice.

What Democracy Is Supposed to Be: The Theoretical Ideal

Before we can understand why democracy is illusory, we must state clearly what it promises. At its most basic, democracy means rule by the people (dēmos and kratos). Political theory identifies four core pillars that any genuine democracy must satisfy:

  1. Popular Sovereignty: Ultimate political authority resides in the citizenry. Leaders hold power only if delegated by the people, and policy must broadly reflect the popular will.
  2. Political Equality: Every citizen’s voice carries equal weight. Factors like wealth, birth, or religion cannot confer extra influence.
  3. Meaningful Participation: Citizens must participate continuously in deliberation and accountability, requiring access to accurate information and a free press.
  4. Accountability and the Rule of Law: Leaders are not above the law and can be punished for corruption or abuse of power. The legal system must apply equally to all.

Modern democracy operates as representative democracy, a compromise where citizens elect officials to govern on their behalf. The illusion of democracy begins exactly at the gap between the representative and the represented; when this gap becomes a chasm, democracy becomes a ceremonial mask over oligarchy.

Structural Engines of Illusion: Economic and Elite Capture

⚠
Economic inequality is a primary driver of the democratic illusion, translating concentrated wealth into concentrated political power and violating political equality.

The most powerful engine of the democratic illusion is economic inequality. In every examined case, concentrated wealth translates into concentrated political power, violating the promise of political equality.

The United States: A Plutocratic Republic

While maintaining formal protections, the American system has increasingly become a plutocratic republic. Empirical research by Gilens and Page (2014) concluded that “the preferences of the average American have a minuscule, near-zero, statistically non-significant impact on public policy”. Instead, policy outcomes overwhelmingly reflect the preferences of economic elites.

  • Real Instance: In 2017, a tax bill cutting corporate rates from 35% to 21% passed despite 65-70% of Americans opposing it. It succeeded because corporate lobbies had spent $500 million on campaign contributions and lobbying in the preceding years.
  • The Wealthification of Politics: The Citizens United decision accelerated this trend, allowing 100 billionaire donors to pour a record $2.6 billion into the 2024 elections, making up nearly 20% of total spending.

Nigeria: The Godfather System and State Capture

In Nigeria, the structural illusion is more overt, manifesting as “state capture” where institutions serve the interests of a powerful few. Political parties are often “private political estates” owned by wealthy patrons who view elections as personal investments.

  • Real Instance: In 2018, Ekiti State Governor Ayodele Fayose admitted that wealthy “godfathers” are the problem with Nigeria’s democracy. These individuals finance campaigns and, in return, receive contracts and public funds, leaving voters with no real say in the primary process.

This reality reaffirms Robert Michels’ “iron law of oligarchy,” which posits that all mature organizations inevitably become ruled by minorities. The technical requirements of governance create a permanent class of rulers who cannot be fully controlled by the democratic process.

The Procedural Mask: Rituals of Choice

The illusion is sustained by procedural fetishism, the belief that if elections are held and ballots are counted, the outcome must be democratic. This allows elite control to persist under the cover of formal correctness.

Managed Democracy and Illiberal States

  • Russia: Russia employs “managed democracy,” where elections occur regularly, but outcomes are predetermined and genuine opposition is barred. Despite this, a 2021 poll found that 45% of Russians considered their country “fully democratic,” showing the power of procedural stagecraft.
  • Hungary: Under Viktor Orbán, Hungary has become an “illiberal state” by legalistically hollowing out institutions from within. The electoral system was modified over 30 times to favor the ruling party while maintaining membership in democratic blocs like the EU.

Electoral Manipulation in the West

In the United States, the illusion of choice is maintained through gerrymandering and the Electoral College.

  • Gerrymandering: In 2022, North Carolina’s map was drawn to produce 10 Republican seats and 4 Democratic seats despite a 50-50 statewide vote split.
  • Electoral College: This system allows the loser of the popular vote to become president, as seen in 2016 when Hillary Clinton won by nearly 3 million votes but lost the presidency due to thin margins in three key states.

The Cognitive Layer: Why Merit Fails

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Human cognitive biases, such as confirmation bias and the availability heuristic, systematically produce political outcomes disconnected from merit or performance.

A critical part of the democratic illusion is the assumption that voters act as rational, objective agents. In reality, human cognitive biases systematically produce outcomes that have little to do with merit or performance.

The Primaries Problem: Eliminating Competence Early

The best candidates rarely survive the first filter of the democratic process.

  • USA 2016: In the Republican primary, Donald Trump defeated experienced governors and senators by exploiting the availability heuristic (vivid slogans like “Build the Wall”) and emotional reasoning. Voters valued “authenticity” over detailed policy knowledge.
  • Nigeria 2023: Party primaries are often “outright auctions”. During the 2023 APC and PDP primaries, delegates were reportedly paid between $10,000 and $50,000 per vote. Wealth and “godfather” backing ensured Bola Tinubu’s nomination over rivals seen as more competent by civil society.

Summary of Key Cognitive Biases in Politics:

Bias

Impact on Democracy

Real-World Instance

Confirmation Bias

Interpreting data to fit pre-existing beliefs.

In the 2020 US election, voters viewed the economy as “good” or “bad” based solely on their partisan identity.

Availability Heuristic

Judging importance by vivid examples.

Brazilian voters in 2018 prioritized violent crime based on viral videos, even as murder rates were declining.

Affective Bias

Voting with emotion rather than facts.

The 2016 Brexit referendum was driven by fear and anger, though few voters could cite actual immigration statistics.

In-group/Out-group Bias

Favoring one’s own ethnic or religious group.

In Kenya’s 2017 election, over 90% of Kikuyu and Luo voters supported candidates from their own tribes, regardless of policy.

Dunning-Kruger Effect

Low-knowledge voters overestimating their understanding.

A 2018 study found the least informed voters were the most confident and resistant to fact-checking.

Educational and Narrative Illusions: Manufacturing Consent

Democracy relies on an informed electorate, yet civic education is often neglected, and information is systematically distorted.

The Civic Literacy Void

  • Nigeria: A 2023 assessment found that only 38% of schools taught civic education regularly. Consequently, 42% of voters did not know the difference between the Senate and House of Representatives.
  • United States: Only 24% of Americans could name all three branches of government in 2023, and 26% could not name any. This ignorance is weaponized by political ads that do not need to be factual because voters lack the knowledge to refute them.

Propaganda and Media Capture

Noam Chomsky’s “propaganda model” explains how democratic societies “manufacture consent” by using media to distort major issues and maintain complicity.

  • The Iraq War (2003): Major US outlets repeated false administration claims about WMDs. Because the media sourced information from “official” channels, 72% of Americans believed these manufactured facts and supported the invasion.
  • Media Ownership: In Nigeria, 60% of media managers have direct financial ties to political parties. During the 2022 health interview of Bola Tinubu, Channels TV reportedly edited the footage under political pressure to make the candidate appear more coherent.
  • Social Media: Algorithms prioritize outrage over truth. In Brazil and India, false WhatsApp messages regarding “school sex kits” or child kidnappings have triggered lynchings and shifted elections because they exploit confirmation bias.

The Cumulative Case: Is Democracy the Best Form of Government?

When we combine structural inequality, procedural manipulation, and cognitive bias, the conclusion is that most people in self-proclaimed democracies do not actually rule. They live in “electoral oligarchies” that use democratic procedures to legitimize elite outcomes.

This leads to the uncomfortable question: Is democracy really the best form of government?

Arguments For Democracy (Even the Illusion):

  • It provides a peaceful transfer of power (when it works), preventing civil war.
  • It protects basic freedoms better than autocracies.
  • It acts as a pressure valve, allowing for the occasional removal of the worst leaders.

Arguments Against Democracy (As Practiced):

  • Competence is not selected for: Charismatic demagogues often win over skilled administrators.
  • Short-termism: Leaders focus on 4-5 year election cycles, ignoring long-term crises like climate change.
  • Rational Ignorance: Voters have no incentive to be informed because a single vote rarely changes an outcome.

Alternative Models to Consider:

  • Epistocracy: Rule by the knowledgeable, where voting depends on passing a literacy test.
  • Sortition: Selecting representatives by lottery (like a jury), eliminating the influence of money and campaigning.
  • Technocracy: Decisions made by experts in relevant fields (economists, scientists).

However, no alternative has proven consistently better. History’s experiments with epistocracy led to disenfranchisement, and technocracies often devolved into brutal autocracies. Democracy is not the “best” because it produces excellence; it is arguably better because it offers accountability without violence.

Conclusion: From Illusion to Awakening

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To move toward authentic democracy, societies must implement fundamental reforms like publicly funded elections, compulsory civic literacy, and proportional representation.

The illusion of democracy persists because it serves the powerful by providing legitimacy without accountability. But illusions cannot be sustained indefinitely. Across the world, trust in institutions is collapsing and voter apathy is rising.

Recognizing the illusion is the first step toward escaping it. To move from illusion to authentic democracy, societies would need fundamental reforms:

  1. Publicly funded elections to break the link between wealth and power.
  2. Compulsory civic and media literacy to combat cognitive manipulation.
  3. Proportional representation and sortition-based citizens’ assemblies to ensure genuine representation.
  4. Real-time fact-checking and “cooling-off” periods for political advertising.

The greatest enemy of democracy is the belief that we already have it. Only by naming the illusion of the “Democratic Mirage” can we begin the work of building a genuine democracy where power truly resides with the people.

References:

I. Foundational Theories: The Promise and the Structural Pitfalls

  • Georgetown University — What is Democracy? Democracy & Governance: Establishes the core principles of popular sovereignty and political equality as the benchmarks for evaluating democratic legitimacy.
  • Stanford University — What is Democracy?: Defines the role of citizens as the highest political authority, providing the standard for when procedures become empty formalities.
  • Democratic Erosion — The Illusion of Democracy (2025): Invokes John Dewey’s view of democracy as a “way of life” based on collective decision-making and equitable power distribution.
  • Noam Chomsky — Necessary Illusions: Thought Control in Democratic Societies (1989): Introduces the “propaganda model,” arguing that media manipulation is to democracy what the “bludgeon” is to a totalitarian state.
  • Robert Michels — Iron Law of Oligarchy (1911): A seminal critique demonstrating that all mature organizations inevitably succumb to rule by an elite minority due to technical and tactical necessities.

II. The American Case Study: Plutocracy and Procedural Manipulation

  • Gilens & Page — Oligarchy in the Open (2014/2025): A landmark study proving that the average American’s preferences have “near-zero” impact on policy, while economic elites exert overwhelming influence.
  • Represent.Us — This study proves the U.S. isn’t a democracy: A summary of the Gilens and Page findings, detailing how Congress ignores public polling in favor of donor interests.
  • Verfassungsblog — The US Supreme Court and Plutocracy: Analyzes how the dismantling of campaign finance limits (e.g., Citizens United) has turned US elections into the world’s most costly.
  • LSE United States Politics and Policy — How gerrymandering could help deliver the presidency…: Examines how district map manipulation and the Electoral College violate the “one person, one vote” principle.
  • Rosa-Luxemburg-Stiftung — Democracy Disregarded: Characterizes the United States as a “dollarocracy” where media moguls and billionaires wield unprecedented control.

III. The Nigerian Case Study: State Capture and Godfatherism

  • Leadership.ng — Ex-LP Presidential Aspirant Warns Of Silent Hijack Of Democracy By Godfathers: Details how wealthy patrons finance campaigns to control party machinery and state resources.
  • TheCable.ng — An infliction called godfatherism: Argues that elite capture of economic opportunities is the core of Nigerian political ambition.
  • Punchng.com — Consequences of electoral malpractice and political godfatherism: Connects Nigeria’s stagnated development directly to a culture where leaders are “thrust into power” by wealthy benefactors.
  • European Union Observation Mission (via The Peninsula): Reports that the 2023 Nigerian elections were marred by logistical failures and violence, damaging public trust in the system.
  • PLACNG.org & NHRC Reports: Document disappointments regarding the failed real-time upload of results (IReV) and widespread voter intimidation and vote buying in 2023.

IV. Global Manifestations of the Illusion

  • EUvsDisinfo — DISINFO: Democracy is the perfect dictatorship: Defines “managed democracy” as a system where elections occur but opposition poses no threat to the ruling party.
  • The Guardian & BBC Reports on Hungary: Chronicle Viktor Orbán’s transition to an “illiberal democracy” through legalistic dismantling of the judiciary and free press.
  • Cambridge Core — The Electoral Paradox (Philippines): Discusses how democratic institutions were deployed to rehabilitate the authoritarian Marcos family.
  • Tricontinental — India Under Modi: Shrinking Democracy: Argues that religious nationalism is used to distract from soaring inequality and the erosion of independent institutions.
  • Democratic Erosion — Ongoing Democratic Erosion in Brazil After Bolsonaro: Documents how anti-system populism led to direct attacks on the presidential palace and Supreme Court.

V. Psychology, Education, and Media Distortion

  • Charles University — Examining the IRA’s Exploitation of Cognitive Biases: Analyzes how misinformation targets confirmation bias and the availability heuristic to sway voters.
  • World Economic Forum — 11 cognitive biases that influence politics: Defines how internal mental shortcuts lead voters to ignore conflicting evidence.
  • International IDEA — The silent infrastructure of democracy: Explains the critical link between educational attainment and genuine civic participation.
  • Annenberg Public Policy Center (2023 Survey): Reveals high rates of civic ignorance in the US, with many citizens unable to name the branches of government.
  • Heinrich Böll Stiftung — Testing the fault lines: Investigates how disinformation campaigns in Africa exploit social divisions to fuel distrust.

VI. Alternatives and Critical Frameworks

  • Jason Brennan — Against Democracy (Georgetown University): A philosophical defense of “epistocracy,” or rule by those with demonstrated political knowledge.
  • Oxford Academic & Wikipedia — Sortition: Explores the use of random selection (lottery) to create representative citizens’ assemblies.
  • Anthony Downs — An Economic Theory of Democracy (1957): Proposes the theory of “rational ignorance,” explaining why voters lack incentive to be informed.
  • Cato Institute & History News Network: Contextualize Churchill’s famous aphorism regarding democracy as the “worst form of government, except for all of the others”.
Disclaimer: The information provided in this document is for general informational purposes only and should not be considered as professional advice.
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THE LEGAL QUAGMIRE OF ONLINE CONSUMER REVIEWS https://1stattorneys.ng/articles/2026/04/22/the-legal-quagmire-of-online-consumer-reviews/ Wed, 22 Apr 2026 00:51:07 +0000 https://1stattorneys.com/articles/?p=990826
The Legal Quagmire of Online Consumer Reviews in Nigeria

The Legal Quagmire of Online Consumer Reviews in Nigeria

BALANCING FOOD SAFETY, FREEDOM OF EXPRESSION, AND CORPORATE REPUTATION IN NIGERIA

Love Dooshima v. Bon Bread as a Case Study

Abstract

The intersection of consumer protection, food safety regulation, freedom of expression, and defamation law has become a pressing legal frontier in Nigeria’s digital age. This article examines a recent controversy involving a content creator who posted a video review of a loaf of bread that purportedly remained fresh for over two months without spoiling, raising concerns about preservatives used in commercial baking. The bakery in question responded with a demand for ₦50 million in damages and a police complaint, leading to the creator’s brief detention. This article uses the incident as a springboard to analyse the broader legal framework governing consumer reviews in Nigeria. It explores the elements of defamation and the challenges of proving “reference” in an anonymous review, the constitutional protection of consumer speech under Section 39 of the 1999 Constitution, the regulatory mandates of the National Agency for Food and Drug Administration and Control (NAFDAC) and the Federal Competition and Consumer Protection Commission (FCCPC), the proper limits of police powers in civil disputes, and the growing concern over Strategic Lawsuits Against Public Participation (SLAPPs). The article argues that while businesses have a legitimate interest in protecting their reputation, the current legal environment in Nigeria creates a chilling effect on consumer speech and undermines public health discourse. It concludes by offering recommendations for legal reform, regulatory clarity, and the development of anti-SLAPP protections.

1. Introduction

In April 2026, a Nigerian content creator, Ms. Love Dooshima, posted a video on TikTok in which she displayed a loaf of bread that, according to her, had remained fresh for two months without spoiling. She did not mention any brand name, show any logo, or display any identifiable packaging. The video went viral, amassing millions of views and sparking widespread public discussion about food safety and the use of preservatives in commercially baked bread in Nigeria.

In response, Bon Bread, an Abuja-based bakery, dispatched solicitors to Ms. Dooshima demanding that she retract the video, delete the post, and pay ₦50 million in damages for alleged defamation and reputational harm. The company also lodged a complaint with the police, leading to Ms. Dooshima’s detention at Zone 7 Police Headquarters in Abuja for several hours. She was released only after the intervention of the Inspector-General of Police.

This incident, while specific in its facts, raises a constellation of legal issues that transcend the immediate parties. It implicates the law of defamation, the constitutional right to freedom of expression, the regulatory framework for food safety, consumer protection law, the proper limits of police powers, and the emerging concern over SLAPP suits in Nigeria. This article uses the Bon Bread controversy as a case study to examine these intersecting legal domains.

2. Defamation: Has a Cause of Action Been Established?

Defamation is the publication of a false statement that injures the reputation of another. Under Nigerian law, a claimant in a defamation suit must establish three essential elements: (a) that the defendant published a statement in permanent form; (b) that the statement referred to the claimant; and (c) that the statement was defamatory of the claimant, that is, it lowered the claimant in the estimation of right-thinking members of society or exposed the claimant to hatred, ridicule, or contempt.

These principles were articulated by the Supreme Court in Sketch Publishing Co. Ltd v. Ajagbemokeferi (1989) 1 NWLR (Pt. 100) 678, where Oputa, JSC held that the burden lies on the plaintiff to prove that the defendant published a defamatory statement that referred to the plaintiff.

2.1 The Element of Reference

ℹ
Defamation in Nigeria requires proving ‘reference’ to the claimant, which is challenging when a consumer review does not explicitly name the brand.

The most contentious element in the Bon Bread controversy is reference. In Abalaka v. Akinsete (2023) 13 NWLR (Pt. 1901) 343, the Supreme Court held that a statement must be identifiable, by reasonable inference, as being about the claimant. The test is an objective one: would a reasonable person, upon viewing the publication, conclude that it referred to the claimant?

In Ms. Dooshima’s case, she did not name Bon Bread, show any logo, or display any identifying mark. The video was a generic commentary on bread preservatives. Bon Bread arguably identified itself by dispatching solicitors who publicly confirmed the company’s connection to the product. The legal doctrine of novus actus interveniens (a new intervening act breaking the chain of causation) may apply: Bon Bread’s own public response, rather than the original video, may have been the proximate cause of any reputational damage.

However, there is a counter-argument that deserves scrutiny. Reports suggest that Ms. Dooshima may have “liked” comments under her video that specifically named Bon Bread. In law, this could be construed as tacit confirmation or adoption of those comments. The question of whether engagement with identifying comments constitutes sufficient “reference” for defamation purposes remains unsettled in Nigerian jurisprudence. It is an issue that, should the case proceed to trial, would require careful judicial consideration.

2.2 Proof of Special Damages

Bon Bread demanded ₦50 million in damages. In Nigerian defamation law, general damages are presumed once defamation is established (libel is actionable per se). However, special damages, such as specific financial losses, must be specifically pleaded and strictly proved. The Supreme Court in Labati v. Badmus (2007) 1 NWLR (Pt. 1014) 199 affirmed that damages must flow naturally and directly from the defendant’s act and must not be remote.

Bon Bread would need to establish a direct, proximate causal link between Ms. Dooshima’s video and its alleged financial losses. Given that the video named no brand and was viewed by millions who may never have associated it with Bon Bread, this burden may be difficult to discharge. Moreover, the company’s own decision to publicly associate itself with the video complicates the causation analysis.

3. Freedom of Expression and Consumer Rights

Consumer reviews on food safety are constitutionally protected under Section 39 of the 1999 Constitution, but must not cross into actionable defamation.

Section 39(1) of the Constitution of the Federal Republic of Nigeria 1999 (as amended) provides: “Every person shall be entitled to freedom of expression, including freedom to hold opinions and to receive and impart ideas and information without interference.” This right is reinforced by Article 9 of the African Charter on Human and Peoples’ Rights, which Nigeria has domesticated and which enjoys the force of law.

The Nigerian courts have consistently affirmed the centrality of free speech. In Director of State Security Services v. Olisa Agbakoba (1999) 3 NWLR (Pt. 595) 314, the Court of Appeal underscored the vital role of free speech in a democratic society, holding that any attempt to unduly limit it must be viewed with suspicion.

3.1 Consumer Reviews as Protected Speech

Consumer reviews and commentary on product quality fall squarely within the ambit of Section 39. A consumer who expresses a genuine concern about the safety or quality of a product is engaging in speech that is constitutionally protected. The right to freedom of expression is not absolute; it is subject to laws that are “reasonably justifiable in a democratic society” under Section 45 of the Constitution. Defamation law is one such limitation.

The critical question is whether Ms. Dooshima’s video crossed the line from protected consumer commentary into actionable defamation. Given the absence of explicit brand identification, it is arguable that her speech fell on the protected side of the line. The public interest in food safety and transparency in consumer goods further strengthens the case for protection.

3.2 The Cybercrime Act and the Risk of Criminalisation

There is a troubling trend in Nigeria of using the Cybercrime (Prohibition, Prevention, etc.) Act 2015 (as amended) to criminalise consumer reviews. Section 24(b) of the Act criminalises the intentional dissemination of false information through computer systems. In the well-known case of Erisco Foods Limited v. Chioma Okoli, a consumer who posted a Facebook review stating that a tomato paste contained “too much sugar” was arrested and faced prosecution under the Cybercrime Act.

The application of criminal law to ordinary consumer reviews creates a dangerous chilling effect. As SERAP and Amnesty International have noted, the use of criminal defamation and cybercrime laws to target peaceful dissent “generates a chilling effect that inhibits the enjoyment of human rights and the circulation of ideas and information.”

4. Food Safety Regulation and NAFDAC’s Role

The National Agency for Food and Drug Administration and Control (NAFDAC) is the primary regulatory body responsible for ensuring the safety and quality of food products in Nigeria. Under the NAFDAC Act and the Food and Drugs Act, all regulated food products must be registered with NAFDAC before they can be manufactured, sold, or distributed.

4.1 The Use of Preservatives in Bread

The claim that a loaf of bread remained fresh for two months without spoiling raises legitimate food safety concerns. In a statement to the media, a NAFDAC official noted that only a laboratory test could confirm whether the bread contained unsafe levels of preservatives. The official added: “I am not too sure of the kind of preservative that will sustain a loaf of bread for that long. We don’t know that kind of preservative. We know bread should not stay longer than a few days.”

This statement underscores the regulatory significance of Ms. Dooshima’s video. Rather than viewing it as a defamatory attack, it could be seen as a public service alert that prompts regulatory scrutiny. NAFDAC has previously warned bakeries against the use of banned substances such as potassium bromate, a flour improver linked to cancer and kidney failure. The agency has shut down bakeries found to be using unapproved additives.

4.2 The Public Interest in Consumer Vigilance

NAFDAC’s own position, that members of the public should bring suspicious food products to the agency’s attention, aligns with the broader public interest in consumer vigilance. A consumer who posts a video raising concerns about food preservatives is, in effect, performing a civic function. The law should encourage, not penalise, such conduct.

The appropriate response to a consumer complaint about food safety is not a defamation suit, but a regulatory investigation. If a bakery is confident in the safety of its products, it should welcome NAFDAC scrutiny as an opportunity to vindicate its standards.

5. Police Powers and the Criminalisation of Civil Disputes

⚠
The use of police powers and the Cybercrime Act to criminalize civil defamation disputes creates a chilling effect on public discourse and consumer rights.

The detention of Ms. Dooshima by the Nigeria Police Force raises serious constitutional concerns. Under Sections 4 and 24 of the Police Act 2020, the police are mandated to act only in respect of conduct that constitutes a criminal offence under Nigerian law.

The Nigerian Bar Association (NBA) has consistently maintained that defamation is a civil wrong, not a criminal offence. In a statement issued in December 2024 concerning the arrest of activist Dele Farotimi, the NBA declared: “The Criminal Law of Lagos State 2011 repealed the criminalisation of defamation by omitting it from its provisions. … This progressive legislative move aligns with global best practices, which treat defamation as a civil wrong rather than a criminal offence.”

The Supreme Court affirmed this position in Aviomoh v. Commissioner of Police & Anor (2021) LPELR-55203(SC), where Justice Helen Ogunwumiju, JSC held that defamation ceased to be a criminal offence in Lagos State following the enactment of the Criminal Law of Lagos State 2011.

Even in jurisdictions where criminal defamation remains on the statute books (under the Criminal Code applicable in some states), the use of police powers to detain a citizen over a consumer review that named no brand is a disproportionate and constitutionally questionable exercise of state power. The police should not be the enforcement arm of corporate grievance.

6. SLAPP Suits and the Chilling Effect on Public Discourse

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Nigeria needs specific anti-SLAPP legislation to protect citizens from retaliatory lawsuits aimed at silencing public criticism.

A Strategic Lawsuit Against Public Participation (SLAPP) is litigation initiated to intimidate and silence critics by burdening them with the cost and stress of a legal defence. The hallmark of a SLAPP suit is that its primary purpose is not to vindicate a genuine legal right but to punish and deter public criticism.

SERAP and the Nigerian Guild of Editors have warned that “using repressive laws and strategic lawsuit against public participation (SLAPP) lawsuits to intimidate and harass journalists, activists, bloggers and CSOs erodes democracy, respect for human rights and the rule of law in Nigeria.” They added: “Criminal defamation and SLAPP lawsuits are neither necessary nor proportionate under the Nigerian Constitution and human rights treaties to which Nigeria is a state party.”

While Nigeria has not enacted specific anti-SLAPP legislation as some jurisdictions have (e.g., the United States and Canada), the courts’ inherent jurisdiction to prevent abuse of process provides a relevant check. A lawsuit demanding ₦50 million from a private citizen who did not explicitly name the company in her video may bear the hallmarks of a SLAPP. The chilling effect of such litigation on consumer speech is profound: it sends a message that any critical commentary on a product, however generic, may result in financial ruin and police detention.

The National Assembly should consider enacting specific anti-SLAPP legislation that would provide for the early dismissal of lawsuits targeting public participation and would award costs to defendants who successfully defeat such claims. This would align Nigeria with international best practices and protect the constitutional right to freedom of expression.

7. The Role of the Federal Competition and Consumer Protection Commission (FCCPC)

The FCCPC, established under the Federal Competition and Consumer Protection Act 2018, is the apex consumer protection body in Nigeria. It has the statutory mandate to promote consumer interests, ensure fair market practices, and prevent exploitative or dangerous conduct in all sectors of the economy, including food and agriculture.

The FCCPC has cautioned food producers and vendors against harmful practices such as chemical ripening of fruits, adulteration of food items, and poor hygiene in food handling, describing them as “grave threats to public health and consumer trust.” In the bread sector, the Commission has sealed bakeries for non-compliance with quality standards.

In the context of the Bon Bread controversy, the FCCPC has a statutory interest. The Commission should investigate whether the use of preservatives in the bread in question complies with applicable standards and whether the company’s response to a consumer review constitutes an unfair or unconscionable practice under the FCCPA.

8. Recommendations

Based on the foregoing analysis, the following recommendations are advanced:

  1. Legislative Reform: The National Assembly should consider enacting specific anti-SLAPP legislation to protect citizens from lawsuits designed to silence public criticism on matters of public interest. Such legislation should provide for expedited dismissal of SLAPP suits and the award of costs to defendants.
  2. Regulatory Clarity: NAFDAC should issue clear guidelines on the permissible levels and types of preservatives in bread and other baked goods. The agency should also establish a dedicated portal for consumers to report suspicious food products, with a guarantee of confidentiality.
  3. Police Guidelines: The Nigeria Police Force should issue internal guidelines clarifying that defamation is a civil wrong and that police involvement in defamation disputes should be limited to cases where there is a clear and present danger to public order or where a court has issued a warrant.
  4. Judicial Vigilance: Courts should be alert to the risk of SLAPP suits and should exercise their inherent jurisdiction to strike out claims that are brought for an improper purpose or that lack a reasonable prospect of success.
  5. Public Education: Consumer advocacy groups and legal aid organisations should educate the public on the right to provide honest reviews of products and the legal boundaries of defamation. Consumers should be encouraged to report food safety concerns to NAFDAC and the FCCPC rather than relying solely on social media.
  6. Corporate Responsibility: Businesses should adopt a more measured response to consumer criticism. Rather than resorting to litigation, companies should engage with consumers, address legitimate concerns, and, where appropriate, invite regulatory scrutiny as a means of demonstrating compliance.

9. Conclusion

The Bon Bread controversy is not an isolated incident. It is emblematic of a broader tension in Nigerian law between the right of consumers to speak freely about products that affect their health and the right of businesses to protect their reputation. The legal framework, as it currently stands, tilts heavily in favour of corporate interests. Defamation law is wielded as a sword to silence criticism; police powers are deployed to detain citizens over civil disputes; and the spectre of crippling damages hangs over anyone who dares to question a product’s safety.

This is not a sustainable equilibrium. A vibrant democracy requires a free and robust marketplace of ideas, including ideas about the safety and quality of consumer goods. The law must evolve to protect the public interest in transparent, safe, and accountable commerce. Until that evolution occurs, the chilling effect on consumer speech will persist, to the detriment of public health and democratic discourse.

10. References

Legislation

  • Constitution of the Federal Republic of Nigeria 1999 (as amended), Section 39.
  • Constitution of the Federal Republic of Nigeria 1999 (as amended), Section 45.
  • Criminal Code Act, Cap. C38, Laws of the Federation of Nigeria 2004, Sections 373–379.
  • Criminal Law of Lagos State 2011.
  • Cybercrime (Prohibition, Prevention, etc.) Act 2015 (as amended 2024), Section 24(b).
  • Federal Competition and Consumer Protection Act 2018.
  • Food and Drugs Act, Cap. F32, Laws of the Federation of Nigeria 2004.
  • National Agency for Food and Drug Administration and Control (NAFDAC) Act, Cap. N1, Laws of the Federation of Nigeria 2004.
  • Police Act 2020, Sections 4 and 24.

Case Law

  • Abalaka v. Akinsete (2023) 13 NWLR (Pt. 1901) 343.
  • Alalade v. African Newspapers Ltd (2022) LCN/16176(CA).
  • Aviomoh v. Commissioner of Police & Anor (2021) LPELR-55203(SC).
  • Chief Tony Okoroji v. Onyeka Onwenu (2016) LCN/9036(CA).
  • Director of State Security Services v. Olisa Agbakoba (1999) 3 NWLR (Pt. 595) 314.
  • Labati v. Badmus (2007) 1 NWLR (Pt. 1014) 199.
  • Sketch Publishing Co. Ltd v. Ajagbemokeferi (1989) 1 NWLR (Pt. 100) 678.

International Instruments

  • African Charter on Human and Peoples’ Rights (Ratification and Enforcement) Act, Cap. A9, Laws of the Federation of Nigeria 2004, Article 9.

Other Sources

  • Nigerian Bar Association, “Libel Is Not a Crime: NBA Calls for Immediate Release of Dele Farotimi” (3 December 2024).
  • SERAP and NGE, “Stop harassing journalists, others – SERAP, NGE tell Tinubu govt, governors” Vanguard (10 December 2025).
  • NAFDAC, “Only Lab Test Can Confirm If Bread Preservative Is Faulty – NAFDAC” Leadership (19 April 2026).
  • FCCPC, “Commission Warns Against Harmful Food Practices, Urges Compliance With Safety Standards” Leadership (8 October 2025).

Disclaimer: This article is for educational and informational purposes only. It does not constitute legal advice. Readers are advised to consult a qualified legal practitioner for advice on specific legal matters.

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An Agent Cannot Claim Commission for Mere Introduction: A Critical Analysis of Philip Kayode Olusegun Ojo v. SDV Nigeria Limited & Anor https://1stattorneys.ng/articles/2026/04/19/an-agent-cannot-claim-commission-for-mere-introduction-a-critical-analysis-of-philip-kayode-olusegun-ojo-v-sdv-nigeria-limited-anor/ Sun, 19 Apr 2026 15:46:49 +0000 https://1stattorneys.com/articles/?p=990816
Agent Commission and the Effective Cause Doctrine: Ojo v. SDV Nigeria Ltd

Agent Commission and the Effective Cause Doctrine: Ojo v. SDV Nigeria Ltd

An Agent Cannot Claim Commission for Mere Introduction: A Critical Analysis of Philip Kayode Olusegun Ojo v. SDV Nigeria Limited & Anor

Introduction: The Evolution of Agency Law in Nigeria

The legal landscape governing agency, brokerage, and real estate commissions in Nigeria has long been fraught with ambiguity, often characterized by informal “gentleman’s agreements” and a pervasive assumption among intermediaries that the mere act of bringing two parties together creates an irrevocable right to compensation. For decades, the Nigerian commercial environment, particularly within the burgeoning real estate and logistics sectors, operated under the misconception that “first to introduce” was synonymous with “entitled to commission”. This assumption has frequently led to protracted litigation, where multiple agents claim fees for the same transaction, often based on nothing more than a preliminary phone call or a casual introduction.

However, the Supreme Court of Nigeria, in the landmark decision of Philip Kayode Olusegun Ojo v. SDV Nigeria Limited & Anor (SC/716/2016), delivered in September 2025, has decisively dismantled these informal assumptions. By establishing a rigorous “effective cause” standard, the apex court has reshaped the legal understanding of agency relationships, imposing a higher evidentiary and performance threshold for entitlement to remuneration. This case stands as a pivotal authority, signaling a shift toward contractual discipline and ensuring that in Nigerian law, commission is a reward for tangible results rather than mere participation.

Case Citation and the Factual Matrix

The dispute, reported as Philip Kayode Olusegun Ojo v. SDV Nigeria Limited & Anor (2025) LPELR-(SC), originated from a common commercial scenario involving an intermediary and a corporate entity. The Appellant, Philip Kayode Olusegun Ojo, positioned himself as a business intermediary who claimed to have identified a lucrative opportunity or property for the Respondents, SDV Nigeria Limited and its associate.

The background events reveal that the Appellant facilitated the initial connection between the parties, introducing a client or opportunity to SDV Nigeria Ltd, a prominent logistics and freight company. Crucially, at this nascent stage, there was no comprehensive written agreement between the parties that clearly defined the scope of the Appellant’s role or the specific conditions under which a commission would become payable. Following this initial introduction, the Appellant’s active involvement in the transaction effectively ceased. He was not a participant in the subsequent high-level negotiations, nor did he play any role in the structuring or formal execution of the final deal.

Meanwhile, the Respondents proceeded to independently negotiate and eventually conclude a successful transaction with the party the Appellant had originally introduced. Upon the completion of the deal, the Appellant sought a substantial commission, contending that his initial introduction was the “foundation” of the transaction and that, but for his efforts, the parties would never have met. The Respondents resisted the claim, arguing that the Appellant’s role was purely historical and peripheral, and that he had failed to contribute to the actual fruition of the deal.

Issues Before the Court: The Quest for Causation

As the matter progressed from the trial court through the appellate hierarchy, the dispute crystallized into a fundamental question of agency law: Is an agent or intermediary entitled to commission merely for the act of introduction, even if they played no material role in the successful conclusion of the transaction?.

The Appellant maintained that introduction alone should ground a right to commission, especially where a transaction is eventually completed between the introduced parties. Conversely, the core issue the Supreme Court had to resolve was whether the Appellant had proved he was the “effective cause” of the transaction. The court was tasked with determining if a legal nexus existed between the Appellant’s preliminary act and the final commercial outcome, or if the chain of causation had been broken by his subsequent inactivity and the independent efforts of the Respondents.

The Decision of the Supreme Court: A Firm Dismissal

The Supreme Court of Nigeria unanimously answered the core question in the negative, dismissing the Appellant’s claim in its entirety. The Court upheld the findings of the lower courts, which had consistently determined that the Appellant’s role began and ended with the mere introduction of the parties.

The Court’s decision was rooted in the finding that the Appellant failed to provide sufficient evidence to establish that he was the “effective cause” of the transaction. Because the transaction had evolved and progressed independently of the Appellant’s initial contact, the Court held that he had no legal entitlement to the claimed commission. Justice Obande Ogbuinya, in a notably forceful pronouncement, described the appeal as being “bereft of any morsel of merit and deserving the reserved penalty of dismissal,” reflecting the Court’s view that the claim lacked a sustainable legal foundation.

The Ratio Decidendi: Binding Principles of Agency Remuneration

ℹ
To recover a commission, agents must prove their efforts were the ‘effective cause’ (causa causans) of the completed transaction.
The Supreme Court of Nigeria established that mere introduction of parties does not automatically entitle an agent to a commission.

The Ojo v. SDV Nigeria Ltd decision establishes several binding principles that now govern agency and brokerage disputes in Nigeria:

  • Mere Introduction is Legally Insufficient: The Court firmly established that an estate agent or intermediary is not automatically entitled to commission simply because they introduced a buyer or tenant to a property or business opportunity. Introduction is viewed as a factual step, not an automatic consideration for payment.
  • The “Effective Cause” Doctrine: To recover commission, a claimant must prove that their services were the “proximate, efficient, or effective cause” (causa causans) of the completed transaction. This requires showing that the agent’s efforts directly led to the consummation of the deal and that the deal was substantially the result of those efforts.
  • Contractual Primacy: Agency is fundamentally a contractual relationship. The entitlement to commission depends on the express terms of engagement, the scope of authority, and the appointment of the agent. A person cannot unilaterally perform unsolicited services and then impose a financial obligation on another party without authorization or ratification.
  • Proof of Continued Involvement: In the absence of an express agreement to the contrary, the law implies that commission is payable only upon the successful completion of the transaction attributable to the agent. If negotiations break off and are later revived independently, the original introducer’s claim to commission is generally extinguished.

Judicial Quotations and Dicta

The judgment is replete with authoritative statements that clarify the Court’s stance on speculative commission claims. Most notably, the Court held that “an agent cannot claim commission for merely introducing a buyer or tenant”. Furthermore, the Court emphasized the evidentiary burden by stating that “the claimant must prove that the introduction was the main and effective cause of the eventual transaction”.

These dicta underscore a critical distinction between a “historical connection”, simply being part of the story of how parties met, and “legal causation,” which involves bringing the deal to fruition. The Court’s language makes it clear that “unsolicited introduction, without more, does not create a legal obligation to pay commission”.

Legal Analysis: Contract, Causation, and Evidence

The Supreme Court’s analysis in Ojo v. SDV Nigeria Ltd harmonizes several key legal doctrines. From the perspective of Contract Law, the decision reaffirms that parties are bound by their agreements. While the law will not presume a right to commission for mere introduction, the principle of contractual freedom remains; parties are free to expressly agree that “commission shall be payable upon introduction alone”. However, without such an express term, the default legal position requires proof of results.

The application of the Causation Test brings agency law in line with principles found in contract and tort law. The Court’s focus on causa causans ensures that a “causal nexus” must exist between the agent’s work and the final outcome. This approach prevents unjust enrichment, protecting principals from having to pay for services that did not actually facilitate the transaction.

Furthermore, the Burden of Proof remains squarely on the agent. Claimants can no longer rely on bare assertions of introduction; they must present credible, documentary evidence of their role, such as email trails, records of negotiation meetings, and correspondence demonstrating ongoing facilitation.

Commercial Impact and Comparative Perspective

The commercial impact of this ruling is significant for all stakeholders in the Nigerian market. For property owners, businesses, and landlords, it provides a robust defense against multiple or speculative commission claims. It ensures that they are only liable to pay those intermediaries who have added genuine value and brought the transaction to completion.

For estate agents and brokers, the decision is a call to professionalism. It discourages the common practice of “door-opening” in hopes of a windfall and encourages agents to stay involved through the negotiation and execution stages to secure their fees.

From a comparative perspective, the Supreme Court’s position aligns Nigeria with other common law jurisdictions, including the United Kingdom, Canada, and Australia. Across these jurisdictions, the prevailing doctrine is that commission is earned by results achieved, not by preliminary efforts, promoting predictability in cross-border commercial relationships.

Operationalizing the Precedent: Model Commission Clauses and Legal Safeguards

✔
Parties should utilize precise contractual language and written mandates to define commission triggers, whether success-based or introduction-based.

To ensure agency agreements are robust and aligned with the principles established in Philip Kayode Olusegun Ojo v. SDV Nigeria Limited & Anor, it is essential for practitioners and businesses to move away from informal arrangements and utilize precise contractual language. The Supreme Court has made it clear that while the default legal position requires an agent to be the “effective cause” of a transaction, the principle of contractual freedom remains paramount. Parties retain the absolute right to define their own triggers for payment, effectively “contracting out” of the default rule if they so choose.

To reflect these legal realities, the following model clauses provide two distinct paths: one that follows the court’s “effective cause” standard (Success-Based) and one that prioritizes the initial introduction (Introduction-Based).

Option 1: Success-Based Commission Clause

This clause is protective of the Principal (Employer) and reflects the default “effective cause” doctrine affirmed by the Supreme Court.

Entitlement to Commission and Effective Cause: The Agent shall be entitled to a commission of [Percentage/Amount] only upon the successful completion and final execution of the Transaction between the Principal and a third party. For the avoidance of doubt, the Agent’s right to such commission is strictly contingent upon the Agent proving that their services, active participation in negotiations, and continued facilitation were the primary and effective cause (causa causans) of the concluded deal.

The parties expressly agree that mere introduction of a third party to the Principal, or the initial sourcing of a property/opportunity without further substantive contribution to the final outcome, shall not entitle the Agent to any commission or financial benefit. If negotiations are terminated and subsequently revived independently of the Agent’s efforts, the Agent shall have no claim to remuneration, as the legal chain of causation will be deemed broken.

Option 2: Introduction-Based Commission Clause

This clause is protective of the Agent and allows the parties to expressly override the default effective cause requirement.

Commission Upon Introduction: Notwithstanding any general legal requirement for an agent to be the effective cause of a transaction, the parties hereby expressly agree that the Agent’s commission shall be deemed earned upon the mere introduction of a prospective [Buyer/Tenant/Partner] to the Principal.

Provided that a Transaction is concluded between the Principal and the introduced party within [Number] months of the initial introduction, the Agent shall be entitled to the full commission regardless of whether the Agent participated in subsequent negotiations or the final execution of the deal. The Principal acknowledges that this is a specific contractual departure from the default “effective cause” standard established in Ojo v. SDV Nigeria Ltd and agrees to be bound by this trigger event.

——————————————————————————–

To ensure these clauses are enforceable and to avoid the evidentiary gaps identified in the Ojo v. SDV Nigeria Ltd case, agreements should incorporate the following standards:

  • Requirement for a Written Mandate: No entitlement to commission shall arise from unsolicited services. All agency relationships must be supported by a signed engagement letter or written mandate that clearly identifies the client and the scope of authority.
  • Definition of “Introduction”: To avoid disputes, “introduction” should be strictly defined as the provision of a party’s contact details and the formal facilitation of a first meeting or exchange, evidenced by a dated record or a formal “Introductory Email”.
  • Preservation of Records: Both parties should maintain a transaction log. For a success-based claim, the agent must preserve email trails, negotiation records, and meeting minutes to prove they were the operative cause of the deal.

Practical Lessons and Relevance to Foreign Investors

⚠
Foreign investors and businesses must conduct legal due diligence and maintain meticulous records of all interactions to defend against speculative claims.

The primary lesson for all parties is the absolute necessity of clear, written agency agreements. Such agreements should explicitly define the “trigger event” for commission, whether it is the mere introduction of a party or the successful execution of a contract.

For foreign investors entering the Nigerian market, this case is particularly instructive. Foreign companies often rely on local intermediaries to navigate complex sectors like energy, infrastructure, or real estate. This ruling highlights the importance of:

  • Conducting legal due diligence before engaging any agent.
  • Utilizing structured intermediary agreements that clearly define roles and compensation triggers.
  • Maintaining meticulous records of all interactions to defend against opportunistic claims from peripheral parties.

Conclusion: Value Creation as the Standard

The Supreme Court’s decision in Philip Kayode Olusegun Ojo v. SDV Nigeria Limited & Anor has effectively ended the era of automatic commissions for mere introductions in Nigeria. The judgment serves as a powerful reminder that in the eyes of the law, commission follows proven value, not mere introduction.

By insisting on proof of effective causation and contractual authorization, the Court has strengthened contractual discipline and promoted fairness in commercial dealings. The enduring takeaway is simple yet profound: an agent is not paid for opening the door if someone else is the one who brings the deal through it. This precedent will undoubtedly remain a cornerstone of Nigerian agency law, ensuring that those who facilitate the country’s commercial growth are rewarded for their substantive contributions to its success.

Would you like me to draft a model commission clause that specifically addresses the “effective cause” requirement or one that allows for payment upon introduction?

Primary Authorities: Judicial Precedents

  • Philip Kayode Olusegun Ojo v. SDV Nigeria Limited & Anor (SC/716/2016, Supreme Court of Nigeria, September 2025).
  • Philip Kayode Olusegun Ojo v. SDV Nigeria Ltd & Anor (2025) LPELR-(SC).
  • NNPC Ltd v. Famfa Oil Ltd (Cited regarding the requirement for instrumental and causative roles in establishing financial entitlements).
  • Savannah Bank Ltd v. Ajilo (Cited for the principle that legal entitlements flow from enforceable obligations).
  • U.B.A. Plc v. Jargaba (Cited regarding the necessity of proven performance over informal expectations).

Secondary Sources: Articles and Insights

Legal Principles and Doctrines Referenced

  • Doctrine of Effective Cause (Causa Causans): The requirement that an agent’s efforts must be the proximate and efficient cause of a completed transaction to earn a commission.
  • Contractual Primacy in Agency: The principle that the terms of engagement and scope of duties defined in a contract govern the entitlement to remuneration.
  • Burden of Proof in Commercial Claims: The evidentiary standard requiring claimants to provide documentary and transactional evidence of their causative role in a deal
Need expert guidance on this topic?
Disclaimer: This document does not constitute legal advice. For specific legal issues, please consult with a qualified legal professional.

References & Citations

Ojo v. SDV Nigeria Limited (SC/716/2016)
citation

Philip Kayode Olusegun Ojo v. SDV Nigeria Limited & Anor (SC/716/2016, Supreme Court of Nigeria, September 2025).

Ojo v. SDV Nigeria Ltd (2025) LPELR-(SC)
citation

Philip Kayode Olusegun Ojo v. SDV Nigeria Ltd & Anor (2025) LPELR-(SC).

NNPC Ltd v. Famfa Oil Ltd
citation

NNPC Ltd v. Famfa Oil Ltd (Cited regarding the requirement for instrumental and causative roles in establishing financial entitlements).

Savannah Bank Ltd v. Ajilo
citation

Savannah Bank Ltd v. Ajilo (Cited for the principle that legal entitlements flow from enforceable obligations).

U.B.A. Plc v. Jargaba
citation

U.B.A. Plc v. Jargaba (Cited regarding the necessity of proven performance over informal expectations).

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Distinguishing Investments from Loans in Nigerian Commercial Law: An Expanded Analysis https://1stattorneys.ng/articles/2026/04/19/distinguishing-investments-from-loans-in-nigerian-commercial-law-an-expanded-analysis/ Sun, 19 Apr 2026 03:58:53 +0000 https://1stattorneys.com/articles/?p=990810

Distinguishing Investments from Loans in Nigerian Commercial Law: An Expanded Analysis

The classification of a capital contribution as a loan or an investment is a fundamental question in Nigerian commercial law, with profound implications for legal rights, tax treatment, and regulatory compliance. This expanded article provides a comprehensive framework for distinguishing between these two forms of financing, incorporating case law, statutory analysis, and practical considerations.

I. Core Conceptual Framework

The distinction between a loan and an investment rests on the legal relationship: loans create a debtor-creditor relationship with absolute repayment obligations, while investments involve ownership stakes and profit-sharing without guaranteed returns.

At its essence, the distinction rests on the legal relationship created between the parties. A loan establishes a debtor-creditor relationship, creating an absolute obligation to repay the principal amount, typically with interest, regardless of the borrower’s financial performance. An investment, in contrast, involves an ownership stake or profit-sharing arrangement where the provider shares in the risks and rewards of the enterprise, without any guaranteed return of capital.

Comparative Summary Table

Feature

Loan

Investment

Primary right

Repayment of principal + interest

Share of profits, dividends, capital appreciation

Return guarantee

Yes (subject to borrower solvency)

No (depends on business performance)

Insolvency ranking

Creditor (higher priority)

Equity holder (lowest priority)

Tax treatment of returns

Interest (deductible to borrower)

Dividends (not deductible)

Voting/control rights

None (unless secured)

Yes (shareholder voting rights)

Risk exposure

Limited to default risk

Full business risk

The courts and tax authorities consistently apply the principle of substance over form: the true nature of the transaction is determined by its economic and legal substance, not merely the label the parties attach to it.

II. Legislative Framework

A. Companies and Allied Matters Act (CAMA) 2020

CAMA 2020 provides the foundational corporate law framework for distinguishing debt from equity. Several provisions are particularly relevant:

  • Section 22 introduces a statutory “right of first offer” for existing shareholders, which applies to equity investments but not to loan arrangements.
  • Sections 178–186 and 222–229 establish the legal framework for creating and perfecting security interests over shares, including charges and pledges, which are characteristic of secured lending transactions.
  • Section 183(3) defines “net assets” as “aggregate of the Company’s assets less the aggregate of its liabilities or provisions for liabilities,” a critical distinction in determining whether a transaction constitutes financial assistance for share acquisition.
  • Sections 718–721 introduce the concept of “netting,” which applies to financial contracts and helps distinguish between debt instruments and equity instruments in complex financing arrangements.
  • Section 159 prohibits a Nigerian company from giving financial assistance directly or indirectly for the purpose of acquiring its shares—a provision that impacts the distinction between genuine equity investments and disguised loans.

B. Investment and Securities Act (ISA) 2024

The Investment and Securities Act 2024 (ISA 2024) has repealed the 2007 Act and introduced significant reforms to Nigeria’s capital market regulatory framework. Key provisions for distinguishing investments from loans include:

  • Expanded definition of securities to include “investment contracts,” ensuring that digital asset operators, exchanges, and service providers comply with investor protection standards.
  • Collective investment scheme regulations under Section 153 (formerly of ISA 2007) define schemes where “members of the public are invited or permitted to invest money or other assets in a portfolio.”
  • Regulatory oversight by the SEC, which has the authority to determine whether an arrangement constitutes a regulated investment or an exempt loan transaction.

The ISA 2024 represents “a significant milestone in the evolution of Nigeria’s capital market, introducing bold reforms that enhance regulatory oversight, market efficiency, and investor protection.”

C. Banks and Other Financial Institutions Act (BOFIA) 2020

BOFIA 2020 is “the primary law governing Nigeria’s banking sector,” regulating the activities of banks, specialised banks, and other financial institutions. Key provisions include:

  • Section 4 BOFIA 2020 – Investment and release of prescribed Minimum Share Capital, establishing capital requirements for financial institutions.
  • Lending restrictions – A bank is prohibited from lending more than 5% of its paid-up capital to any of its directors and significant shareholders, with an aggregate exposure limit of 10% across all directors and significant shareholders.
  • Regulation of investment activities – The Act provides the framework for distinguishing between a bank’s lending activities and its investment activities, each subject to different regulatory requirements.

D. Nigerian Investment Promotion Commission Act (NIPCA) and Foreign Exchange Act

For foreign capital contributions, the Nigerian Investment Promotion Commission Act (NIPCA) and the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act (FEMMPA) provide the regulatory framework. These statutes:

  • Guarantee unrestricted transferability of proceeds and capital repatriation for foreign investors
  • Require registration of foreign investments with the NIPC
  • Distinguish between foreign loans (subject to certain approvals) and foreign direct investment (subject to different regulatory requirements)

III. Judicial Framework and Case Law

✔
Nigerian courts and tax authorities consistently apply the principle of substance over form to determine the true nature of a transaction, regardless of the label attached by the parties.

Nigerian courts have developed a robust body of case law establishing criteria for distinguishing loans from investments. The courts consistently apply a substance-over-form approach, examining the economic reality of the transaction rather than the labels assigned by the parties.

A. Supreme Court Guidance

In Prince Uche Nwole v. Skye Bank Plc (2018) , the Supreme Court considered an appeal arising from a dispute over loan facilities totalling N65 million (comprising a N26 million loan facility and a N39 million bridging facility). The case is instructive for distinguishing between genuine loan transactions and other forms of capital contribution. The Supreme Court “went further to explain that the summary judgment” procedure was appropriate for loan recovery where the debtor-creditor relationship was clearly established.

Olalomi Industries Ltd. v. Nigerian Industrial Development Bank Ltd (2009) involved two loans granted to the appellant—a term loan and a facility secured by a Deed of Mortgage. The Supreme Court’s analysis reinforced that the existence of security instruments and fixed repayment obligations are hallmarks of a loan relationship.

Nwosu v. Uba (2004) addressed a dispute over a loan contract for the purchase of shares that went awry, illustrating the intersection between loan transactions and share acquisitions. The case demonstrates that even where funds are used for share purchases, the underlying financing arrangement may retain the characteristics of a loan.

B. Court of Appeal Principles

In a dispute involving “a Credit Guarantee Bond issued by the Appellant (an insurance company) in favour of the Respondent (a bank), guaranteeing a N150 million overdraft facility granted to Fort Knox Investment Limited,” the Court of Appeal examined the nature of guarantee obligations and their relationship to underlying loan facilities.

The Court of Appeal has also addressed lender liability issues in margin loan facilities, developing the doctrine that “under certain circumstances, borrowers can hold lenders liable under a margin loan facility.” This jurisprudence underscores that the classification of a transaction as a loan carries specific legal consequences regarding the lender’s duties and potential liabilities.

Alison Idris Nig. Ltd v. Pinash Investment Services Ltd (2016) involved “two consolidated suits arose from a banker-customer relationship where the issue of a mortgage was involved,” further illustrating how Nigerian courts analyze the debt-equity distinction in the context of secured lending arrangements.

C. Judicial Distinction Criteria

Drawing from the case law, Nigerian courts consider the following factors in distinguishing loans from investments:

Factor

Loan Indicator

Investment Indicator

Fixed repayment schedule

Present

Absent

Interest payments

Stated rate, fixed or floating

Profit share, variable

Security/collateral

Typically present

Rare

Voting rights

None

Present

Insolvency ranking

Creditor

Equity holder

Risk of capital loss

Limited to default

Full business risk

Documentation

Loan agreement, promissory note

Share certificate, subscription agreement

IV. Tax Implications

The distinction between loans and investments carries significant tax consequences under Nigerian tax law.

A. Withholding Tax (WHT)

Withholding Tax in Nigeria is “a form of advance payment of income tax” that applies to various types of income, including interest on loans. Key considerations include:

  • Interest on loans paid by a Nigerian company is often not subject to WHT under certain conditions.
  • Dividends paid to investors are subject to WHT at applicable rates, but the paying company cannot deduct dividend payments for tax purposes.
  • The Finance Act 2019 introduced changes to the withholding tax exemption for interest on foreign loans, affecting cross-border financing arrangements.

B. Thin Capitalisation Rules

⚠
Nigeria enforces thin capitalization rules with a debt-to-equity ratio of 2:1, limiting the amount of interest expense a company can deduct to prevent tax manipulation.

Nigeria has formal thin capitalization rules, set at a debt-to-equity ratio of 2:1, which “limit the amount of interest expense a company can deduct for tax purposes based on the proportion of debt in its capital structure.”

The thin capitalization rules “aim to prevent companies from using excessive debt to finance their operations and, in turn, manipulate their tax liabilities” by recharacterizing equity investments as debt to obtain interest deductions.

C. Corporate Income Tax

Under the Companies Income Tax Act (CITA) :

  • Interest on loans is generally deductible for the borrower (subject to thin capitalization limitations)
  • Dividends are not deductible for the paying company
  • The classification of a transaction as debt or equity directly impacts the taxable income of both parties

V. Practical Guidance for Drafting Financing Agreements

✔
Financing documentation must clearly reflect the intended legal nature of the transaction, including fixed repayment schedules for loans or profit-sharing mechanisms for equity, to minimize classification disputes.

To minimize classification disputes, parties should ensure that their financing documentation clearly reflects the intended legal nature of the transaction.

A. For Loan Transactions

Documentation should include:

  • Fixed repayment schedule with specified maturity date
  • Stated interest rate (fixed or floating)
  • Security/collateral provisions
  • Events of default and acceleration clauses
  • Clear characterization as a “loan” in the agreement title and recitals
  • Arm’s length terms consistent with market practice

A. For Equity Investments

Documentation should include:

  • Share subscription agreement or investment agreement
  • Allocation of shares and shareholder rights
  • Profit-sharing mechanism (dividends, distributions)
  • No guaranteed return of capital
  • Voting and governance rights
  • Exit provisions (buy-back rights, tag-along/drag-along rights)

C. Hybrid Instruments

Where instruments have characteristics of both debt and equity (e.g., convertible notes, preference shares), parties should:

  • Clearly specify the circumstances under which conversion occurs
  • Address tax treatment of payments pending conversion
  • Consider regulatory approvals required for hybrid instruments

VI. Regulatory and Compliance Considerations

A. SEC Registration Requirements

Under the ISA 2024, arrangements that constitute “investment contracts” may require registration with the SEC. The SEC “has assured stakeholders of a seamless transition from the repealed ISA 2007 to the new regulatory framework.”

B. CBN Approval for Lending

Certain lending transactions, particularly those involving banks or cross-border elements, may require CBN approval under BOFIA 2020.

C. NIPC Registration for Foreign Investment

Foreign capital contributions characterized as equity investment must be registered with the Nigerian Investment Promotion Commission to benefit from guarantees of capital repatriation and profit transfer.

VII. Conclusion

Distinguishing between a loan and an investment is a critical exercise in Nigerian commercial law with far-reaching consequences. The classification determines legal rights and obligations, tax treatment, regulatory compliance requirements, and the parties’ respective positions in insolvency. Parties to financing transactions must ensure that documentation reflects the true economic substance of the arrangement, guided by the statutory frameworks and judicial principles discussed above. By understanding these principles and seeking appropriate legal advice, businesses and individuals can structure financing arrangements that achieve commercial objectives while minimizing legal, regulatory, and tax risks.

This article is provided for informational purposes only and does not constitute legal advice. Readers should consult qualified legal counsel for advice on specific transactions.

References

  1. Companies and Allied Matters Act (CAMA) 2020.
  2. Investment and Securities Act (ISA) 2024 (repealing ISA 2007).
  3. Banks and Other Financial Institutions Act (BOFIA) 2020.
  4. Nigerian Investment Promotion Commission Act (NIPCA) Cap N117 LFN 2004.
  5. Foreign Exchange (Monitoring and Miscellaneous Provisions) Act (FEMMPA) Cap F34 LFN 2004.
  6. Companies Income Tax Act (CITA) Cap C21 LFN 2004 (as amended by Finance Acts 2019-2023).
  7. Prince Uche Nwole v. Skye Bank Plc (2018) – Supreme Court of Nigeria.
  8. Olalomi Industries Ltd. v. Nigerian Industrial Development Bank Ltd (2009) LLJR-SC.
  9. Nwosu v. Uba (2004) – Supreme Court of Nigeria.
  10. Alison Idris Nig. Ltd v. Pinash Investment Services Ltd (2016) NGCA 3.
  11. Finance Act 2019, Finance Act 2020, Finance Act 2021, Finance Act 2023.
  12. Securities and Exchange Commission (SEC) – Investment and Securities Act implementation guidelines.
Disclaimer: This document does not constitute legal advice. For specific legal issues, please consult with a qualified legal professional.
Need expert guidance on this topic?

References & Citations

CAMA 2020
source

Companies and Allied Matters Act (CAMA) 2020.

ISA 2024
source

Investment and Securities Act (ISA) 2024 (repealing ISA 2007).

BOFIA 2020
source

Banks and Other Financial Institutions Act (BOFIA) 2020.

NIPCA
source

Nigerian Investment Promotion Commission Act (NIPCA) Cap N117 LFN 2004.

FEMMPA
source

Foreign Exchange (Monitoring and Miscellaneous Provisions) Act (FEMMPA) Cap F34 LFN 2004.

CITA
source

Companies Income Tax Act (CITA) Cap C21 LFN 2004 (as amended by Finance Acts 2019-2023).

Prince Uche Nwole v. Skye Bank Plc
citation

Prince Uche Nwole v. Skye Bank Plc (2018) – Supreme Court of Nigeria.

Olalomi Industries Ltd. v. NIDB
citation

Olalomi Industries Ltd. v. Nigerian Industrial Development Bank Ltd (2009) LLJR-SC.

Nwosu v. Uba
citation

Nwosu v. Uba (2004) – Supreme Court of Nigeria.

Alison Idris Nig. Ltd v. Pinash Investment Services Ltd
citation

Alison Idris Nig. Ltd v. Pinash Investment Services Ltd (2016) NGCA 3.

Finance Acts
source

Finance Act 2019, Finance Act 2020, Finance Act 2021, Finance Act 2023.

SEC Guidelines
source

Securities and Exchange Commission (SEC) – Investment and Securities Act implementation guidelines.

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Futures Trading in Nigeria: A Comprehensive Legal Analysis https://1stattorneys.ng/articles/2026/04/19/futures-trading-in-nigeria-a-comprehensive-legal-analysis/ Sun, 19 Apr 2026 01:21:52 +0000 https://1stattorneys.com/articles/?p=990783

Futures Trading in Nigeria: A Comprehensive Legal Analysis

Introduction

Futures trading has emerged as a critical component of Nigeria’s evolving financial markets, offering participants essential tools for risk management, price discovery, and investment diversification. As a derivatives contract that obligates the buyer to purchase, or the seller to sell, an underlying asset at a predetermined future date and price, futures trading operates within a sophisticated legal ecosystem designed to ensure market integrity, protect investors, and foster economic growth.

Historically, Nigeria’s derivatives market remained nascent compared to developed economies. However, recent legislative and regulatory developments have fundamentally transformed the landscape, creating a robust legal framework that positions Nigeria as a significant player in Africa’s capital markets. The enactment of the Investments and Securities Act, 2025 (“ISA 2025”) marks a watershed moment, repealing the 2007 framework and introducing comprehensive reforms that explicitly recognize and regulate futures, options, derivatives, commodities, and virtual assets within a unified statutory regime.

This article provides a comprehensive legal analysis of futures trading in Nigeria, examining the statutory framework, regulatory architecture, licensing requirements, compliance obligations, enforcement mechanisms, and emerging trends shaping the sector.

Historical Evolution of the Regulatory Framework

The journey toward a regulated futures market in Nigeria began decades ago. In 1989, an Inter-Ministerial Technical Committee was established at the behest of the Central Bank of Nigeria (“CBN”) to explore establishing a futures exchange for agricultural commodities, addressing systemic challenges in agro-commodity marketing. This initiative laid the groundwork for what would become a gradual, phased development of the commodities and derivatives ecosystem.

The Securities and Exchange Commission (“SEC”) launched the Capital Market Masterplan 2015-2025, which envisioned a thriving commodities trading ecosystem where standardized commodities contracts and futures contracts would be traded on licensed commodities exchanges, enabling price discovery, risk management, quality standards, and access to capital. This policy direction led to the licensing of commodities exchanges and the formal trading of commodities contracts.

In 2017, the SEC established a Technical Committee on Commodities Trading Ecosystem to further develop the regulatory infrastructure. The SEC granted a full operating licence to the Lagos Commodity and Futures Exchange (“LCFE”), a platform promoted by the Association of Securities Dealing Houses of Nigeria, marking a significant milestone in institutionalizing futures trading.

The most transformative development occurred in December 2019, when the SEC issued amendments to its Rules and Regulations, introducing new rules on the regulation of derivatives trading and central counterparties (“CCPs”). These rules, developed in collaboration with the Nigerian Stock Exchange (“NSE”), provided the first comprehensive regulatory framework for derivatives products in Nigeria. In February 2020, the CBN, in collaboration with FMDQ Holdings Plc, offered its first long-term naira-settled OTC FX futures contracts, allowing market participants to hedge foreign exchange risk with tenors of up to five years.

Overview and Scope

The ISA 2025, signed into law by President Bola Ahmed Tinubu in March 2025, represents the most significant legislative reform of Nigeria’s capital markets in nearly two decades. The Act comprises 358 sections divided into 18 Parts, consolidating regulatory learning and addressing gaps that persisted under the 2007 regime. It explicitly empowers the SEC to oversee and regulate all commodities exchanges, making the agency the cornerstone of the regulatory framework for commodities trading in Nigeria.

Expanded Definition of Securities

The Investments and Securities Act 2025 (ISA 2025) expands the definition of securities to explicitly include commodities, futures, options, derivatives, and virtual assets.

Section 357 of the ISA 2025 fundamentally expands the definition of “securities” beyond traditional shares and bonds to explicitly include commodities, futures, contracts, options, derivatives, and any other instrument deemed as securities that may be transferred by electronic means. This expansive definition is critical for futures trading, as it brings futures contracts squarely within the SEC’s regulatory purview and subjects them to the full range of investor protection and market integrity provisions under the Act.

Crucially, the ISA 2025 also recognizes virtual and digital assets, including cryptocurrencies and tokens, as securities, bringing Virtual Asset Service Providers (“VASPs”), digital asset operators, and digital asset exchanges under SEC regulation. This recognition has profound implications for crypto futures and digital asset derivatives, which now operate within a clear legal framework rather than a regulatory grey area.

Classification of Securities Exchanges

ℹ
The ISA 2025 introduces a classification system for securities exchanges, categorizing them into Composite and Non-Composite (Mono and ATS) exchanges to promote market segmentation.

The ISA 2025 introduces a comprehensive classification system for securities exchanges that directly impacts futures trading platforms. Exchanges are categorized into two primary classes:

  1. Composite Securities Exchange: Authorized to list, quote, and trade all categories of securities, commodities, and financial products. This broad-based classification is intended for entities offering diverse asset classes on a single platform.
  2. Non-Composite Securities Exchange: Further subdivided into:
    • Mono Securities Exchange: Restricted to listing and trading a single type of asset, commodity, or financial product. This classification may be particularly appropriate for specialized futures exchanges.
    • Alternative Trading System (“ATS”): Designed for platforms facilitating trading via electronic systems, either at physical locations or through online platforms.

This classification system promotes clearer market segmentation, fosters specialization, and enhances regulatory oversight, enabling both investors and issuers to engage with the market more effectively.

Part XV of the ISA 2025 (Sections 224-267) establishes a comprehensive legal framework for commodities exchanges and warehouse receipts. Section 224 prohibits any person from establishing or maintaining a commodities exchange without proper authorization, while Section 225 empowers the SEC to prescribe minimum share capital requirements for commodities exchanges.

Section 226 mandates that commodities exchanges make rules for the effective performance of their functions, which must be approved by the SEC. Section 228 enumerates the responsibilities of commodities exchanges, including the obligation to conduct business in a fair and transparent manner. Section 233 empowers the SEC to issue directives to commodities exchanges where appropriate, providing a mechanism for regulatory intervention when necessary.

The Act also provides statutory recognition for warehouse receipts as tradable and investment assets, a transformative development for commodities futures trading. Sections 240-267 provide the framework for warehouse receipts, enabling structured financing and reducing market risks in sectors such as agriculture and mining. This recognition addresses a long-standing challenge: banks and financial institutions previously cited the absence of a law backing warehouse receipts as a barrier to commodities transaction funding.

SEC’s Expanded Powers and Autonomy

The ISA 2025 significantly strengthens the SEC’s regulatory and enforcement framework. Section 1(4) introduces a novel provision affirming the Commission’s independence, consistent with International Organization of Securities Commissions (“IOSCO”) standards, providing that the Commission shall operate autonomously and not be subject to the direction or control of any other authority or person except as expressly provided under the Act.

Section 355 empowers the SEC to make rules and regulations specifically directed at derivatives, including matters relating to derivatives markets and business, derivatives exchanges, market infrastructure, business operators, and trade associations. It also authorizes the SEC to take measures aimed at preventing unfair derivatives trading practices. Section 356(3) preserves all prior regulations and orders issued by the SEC prior to the Act’s enactment, ensuring continuity and legal certainty.

Transition from ISA 2007

The ISA 2025 repeals and replaces the Investments and Securities Act 2007 (No. 29 of 2007), which had served as Nigeria’s foundational document for securities and investments regulation. Under the ISA 2007, the SEC operated as the apex regulatory body of the Nigerian capital market, with powers to make rules and regulations, register securities exchanges and self-regulatory organizations, and impose penalties on defaulting operators. The 2007 Act also established the Administrative Proceedings Committee (“APC”) as a quasi-judicial fact-finding body and the Investments and Securities Tribunal (“IST”) to adjudicate disputes involving SEC decisions. These institutional structures have been preserved and strengthened under the ISA 2025.

The Securities and Exchange Commission Regulatory Framework

The SEC Rules and Regulations

The SEC Rules and Regulations 2013 (as amended) constitute the operational “bible” of the Nigerian capital market, containing detailed provisions on derivatives transactions, including commodities and futures trading. The SEC periodically releases new rules to complement the SEC Rules, adapting to market developments and international best practices.

The Derivatives Trading Rules (2019)

In December 2019, the SEC published the Rules on Regulation of Derivatives Trading (the “Derivatives Trading Rules”), providing a framework for the regulation of derivatives products in Nigeria. These rules establish registration requirements for derivatives contracts and market participants and apply to exchange-traded derivatives, with specific provisions extending to OTC derivatives trades when explicitly referenced in the relevant derivative contract.

The Central Counterparty Rules (2019)

Concurrently, the SEC introduced the Rules on Regulation of Derivatives and Central Counterparties 2019 (the “CCP Rules”), which outline the requirements for registration as a central counterparty, a critical component of futures market infrastructure that mitigates counterparty credit risk by interposing itself between buyers and sellers.

The Central Bank of Nigeria Framework

The CBN plays a complementary but essential role in regulating the Nigerian derivatives market, particularly in relation to foreign exchange trades. In March 2011, the CBN introduced the Guidelines for FX Derivatives in the Nigerian Financial Markets (the “FX Derivatives Guidelines”), setting out approved FX derivatives products that can be offered by authorized dealers in the Nigerian financial markets. The CBN also released Revised Guidelines further refining this framework.

The CBN’s role extends to regulating how banks interact with derivatives markets and maintaining monetary stability. Under the ISA 2025, the SEC is empowered to collaborate with the CBN in regulating all matters related to financial market settlement and stability.

Licensing and Registration of Commodities Exchanges

The SEC regulates and supervises Nigeria’s commodities exchange markets. Currently, three primary commodities exchanges operate under SEC oversight: the Abuja Securities and Commodities Exchange (dealing with agricultural products), the Lagos Commodities and Futures Exchange (dealing with agricultural products, oil, gas, and currency), and AFEX Commodities Exchange Limited (dealing with agricultural products).

The ISA 2025 mandates that commodities exchanges be registered with the SEC, which prescribes minimum share capital requirements and ensures compliance with incorporation requirements under the Companies and Allied Matters Act (“CAMA”) 2020. Commodities exchanges are also empowered to engage in self-regulation, subject to SEC oversight.

Types of Futures and Derivative Contracts

Definition and Characteristics

A derivative contract is a bilateral contract whose value is derived from an underlying asset, such as a commodity, currency, interest rate, property value, or company share. Derivatives are financial instruments used for hedging and risk management, allowing parties to lock in the value of an underlying asset for a future settlement date to protect against price fluctuation risk and speculate on future asset values.

The locked price, known as the strike price, serves as the value reference or consideration upon which the contract will be settled and the underlying asset transferred to the buyer on the settlement date.

Settlement Methods

Derivative contracts may be settled in two ways:

  1. Cash Settlement: Settlement is completed through a cash payment, typically representing the difference between the strike price and the market value at the settlement date. This method is common for financial derivatives where physical delivery is impractical.
  2. Physical Settlement: The underlying asset is physically transferred to the buyer on the settlement date in consideration for the strike price. This method is typical for commodity futures contracts where actual delivery of the commodity is intended.

Vanilla versus Exotic Derivatives

Derivative products may be classified as vanilla or exotic. A vanilla derivative is a standard derivative product whose features are well-defined and actively traded, with basic characteristics such as strike price and settlement date and no special features. An exotic derivative is an unusual derivative structured and developed to meet specific requirements of the contracting parties, containing more complicated features tailored to particular transaction requirements.

Exchange-Traded versus Over-the-Counter Derivatives

Derivative contracts may be privately traded over-the-counter (“OTC”) or exchange-traded through specialized exchanges. An OTC derivative is a privately negotiated derivative contract structured according to the requirements of the contracting parties, with each party bearing the counterparty’s credit risk. Exchange-traded derivatives are standardized derivative contracts entered into through an exchange, which acts as an intermediary, with the exchange’s clearing house acting as the central counterparty and assuming limited credit risk.

In Nigeria, there is currently no robust legal framework specifically regulating OTC derivatives contracts, which are usually governed by the terms of the private agreement between parties. However, the ISA 2025 provides the SEC with authority to regulate both exchange-traded and OTC derivatives, and the Derivatives Trading Rules apply to OTC derivatives trade when specifically mentioned in the relevant derivative contract.

Registration of Market Intermediaries

The SEC registers securities and market intermediaries to guarantee their fitness and suitability to operate in the capital market. The SEC’s oversight encompasses a wide spectrum of capital market operators, including brokers, broker/dealers, dealers, floor brokers, floor traders, fund managers, investment advisers, issuing houses, market makers, portfolio managers, underwriters, and other categories essential to futures trading infrastructure.

Capital Requirements

Under Section 225 of the ISA 2025, the SEC is empowered to prescribe the minimum share capital for commodities exchanges, ensuring that only financially viable entities operate in the futures market. The SEC also prescribes net capital requirements for broker/dealers and other market participants, maintaining financial stability and protecting customer assets.

Compliance Obligations

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Market participants must maintain proper books of account, comply with minimum share capital requirements, and adhere to SEC rules to ensure market integrity.

Commodities exchanges must maintain proper books of account and records relating to their operations. They are required to make rules for the effective performance of their functions and must provide notice to the SEC of any disciplinary actions taken against members or participants. The SEC may review any disciplinary action taken by a commodities exchange, providing an additional layer of oversight and accountability.

Virtual Asset Service Providers

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Virtual Asset Service Providers (VASPs) and digital asset exchanges must register with the SEC before conducting business; operating without authorization is illegal.

Under the ISA 2025, VASPs, digital asset operators, and digital asset exchanges must register with the SEC before conducting business. Operating a digital asset exchange or an online foreign exchange trading platform without SEC authorization is now illegal. The SEC has issued Rules on Virtual Asset Service Providers and established the Accelerated Regulatory Incubation Program (“ARIP”) to facilitate orderly market entry.

Over-the-Counter Derivatives

For OTC derivatives transactions, market participants typically rely on standard documentation such as the International Swaps and Derivatives Association (“ISDA”) master agreements. G Elias, a leading Nigerian law firm, has authored standard legal opinions, including a netting opinion, for Nigeria for ISDA and other entities, providing legal certainty for international derivatives transactions involving Nigerian counterparties.

Investor Protection

The ISA 2025 prioritizes investor protection as a central objective. The Act expressly prohibits Ponzi schemes and other unlawful investment operations, providing a clear legal framework for identification, prohibition, and prosecution of such illicit activities. Individuals found operating illegal investment schemes may face imprisonment for a term of up to ten years.

The Investor Protection Fund, established under the ISA, covers losses arising from the revocation of a dealing member’s registration, while administrative penalties offer a faster alternative to prosecution. The Fund is aimed at protecting subscribers against loss and damage arising from the default of issuers and their agents.

Prohibition of Market Manipulation

The ISA 2025 and SEC Rules contain robust provisions against fraud and market manipulation, including insider dealing, fraudulent inducement, wash trades, self-matching transactions, artificial price formation, and misleading market activity. The Act provides guidelines on settlement procedures and timelines for commodities spot markets, ensuring orderly market conduct.

Systemic Risk Management

The ISA 2025 empowers the SEC to issue written directives for managing systemic risks, including suspending trading if necessary for market stability. New frameworks for Financial Market Infrastructures, insolvency, and systemic risk management enable the SEC to identify vulnerabilities, collaborate with other regulators, and take pre-emptive measures during periods of financial stress.

Inspection and Surveillance

The SEC conducts both on-site and off-site inspections to maintain market integrity and scrutinize market participants for regulatory compliance. Vigilant surveillance prevents market rule violations and manipulations, safeguarding the interests of investors.

Warehouse receipts are now legally recognized as tradable and investment assets, enabling structured financing and reducing market risks in sectors like agriculture and mining.

A transformative legal safeguard introduced by the ISA 2025 is the recognition of warehouse receipts as tradable and investment assets. Warehouse receipts are defined as any commercial space, building, silo, cold chain, tank farm or compressed tank, vessel, vault, structure, or other protected enclosure approved by the Commission for the storage or conditioning of commodities. This recognition enables warehouse receipts to serve as tradeable and transferable collateral in commodities transaction funding, reducing counterparty risk and enhancing market confidence.

Enforcement Mechanisms and Sanctions

Expanded Enforcement Powers Under ISA 2025

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The SEC has expanded enforcement powers under ISA 2025, allowing direct regulatory intervention, asset freezes, and referrals for criminal prosecution without prior procedural constraints.

The ISA 2025 significantly expands the SEC’s enforcement power, allowing the Commission to take direct and immediate action against suspected violators without the procedural constraints present under the ISA 2007. This enhanced authority represents a fundamental shift from passive oversight to active policing of the market.

Key enforcement powers include:

  • Direct Regulatory Intervention: The SEC can intervene in the management and control of failing capital market operators without the prior notice and procedural requirements that previously applied.
  • Investigation Authority: The ISA 2025 authorizes the SEC to obtain telecom and electronic data for investigations, enabling more robust enforcement against fraud and market abuse.
  • Asset Freezes and Regulatory Shutdowns: The SEC can freeze assets and order regulatory shutdowns of non-compliant entities operating in regulated sectors.
  • Referral for Criminal Prosecution: Enforcement action may result in referral to the Nigeria Police Force, Economic and Financial Crimes Commission (“EFCC”), or the Attorney-General of the Federation where allegations are found to be criminal in nature.

Penalties for Non-Compliance

Penalties for unauthorized or non-compliant futures trading activities can be severe. Under the ISA 2007, Section 312 prescribed a fine of N1 million or imprisonment for a term of two years, or both, for unauthorized securities trading. The ISA 2025 has significantly enhanced these penalty provisions, particularly in relation to market manipulation and fraudulent activities.

Recent Enforcement Actions

The enhanced enforcement framework under the ISA 2025 has already yielded tangible results. In March 2026, NGX Regulation Limited imposed disciplinary sanctions on five trading licence holders, CSL Stockbrokers Limited, Cowry Securities Limited, Meristem Stockbrokers Limited, SMADAC Securities Limited, and Associated Asset Managers Limited, for engaging in wash trades, self-matching transactions, artificial price formation, and misleading market activity.

CSL Stockbrokers Limited was fined N91.29 million, while the other four firms were each penalized N50 million in line with provisions of the ISA 2025. In addition to financial penalties, all five firms were mandated to undergo compulsory compliance and market conduct training to reinforce regulatory adherence. The SEC has consistently reiterated a zero-tolerance stance on fraud and unethical practices, warning that violators will face tougher penalties.

Dispute Resolution Mechanisms

The ISA 2025 preserves the dispute resolution mechanisms established under the ISA 2007. The Administrative Proceedings Committee serves as a quasi-judicial fact-finding body, providing an avenue for market operators against whom complaints have been made to be heard prior to the determination of the complaint by the SEC. Decisions of the APC are regarded as decisions of the SEC, and appeals may be made to the Investments and Securities Tribunal, which adjudicates questions of law or disputes involving SEC decisions and various categories of disputes among market participants.

The Future of Futures Trading in Nigeria

Digital Assets and Crypto Futures

The express recognition of virtual assets as securities under the ISA 2025 opens significant opportunities for crypto futures and digital asset derivatives. Nigerians may now buy, trade, hold, and invest in digital assets without fear of violating the law, though digital assets remain not recognized as legal tender. The SEC’s regulatory framework for VASPs provides the legal infrastructure for digital asset futures trading, including compliance requirements, licensing standards, and investor protection measures.

Commodities Futures Expansion

The ISA 2025’s broad definition of commodities, including precious metals, electricity, crude oil and gas, agricultural produce, livestock, currency, solid minerals, digital assets, by-products of commodities, and processed commodities products, has significantly deepened the commodities market and enlarged the variety of commodities that can be traded on an exchange. This expansion creates opportunities for futures contracts across diverse asset classes previously excluded from formal commodities trading.

Proposed Commodities Futures Trading Commission

A Bill for an Act to Regulate Commodities Futures Trading in Nigeria, proposing the establishment of a Commodities Futures Trading Commission, has been introduced in the National Assembly. The Bill seeks to provide for the regulation of commodities futures business and the establishment of a dedicated Commission. However, industry observers have noted that the Bill’s objectives could be served by the existing SEC framework, and the ISA 2025 already provides comprehensive regulatory authority over commodities futures trading.

International Alignment

The ISA 2025 aligns Nigeria’s regulatory framework with IOSCO standards, helping Nigeria retain its “Signatory A” status, a benchmark for robust regulatory standards. This international alignment is expected to attract foreign investment into Nigeria’s futures markets, as leading global banks and financial institutions from Europe and Asia have already shown interest in the Nigerian derivatives market.

Regulatory Harmonization

The ISA 2025 promotes inter-agency collaboration, with the Director-General of the National Pension Commission now included as a member of the SEC Board, fostering increased pension fund participation in the capital market. The SEC is empowered to collaborate with the CBN in regulating financial market settlement and stability, ensuring coherent oversight across the financial system.

Conclusion

The legal framework for futures trading in Nigeria has undergone a remarkable transformation, evolving from a nascent, fragmented regulatory landscape to a comprehensive, internationally aligned statutory regime under the Investments and Securities Act 2025. The ISA 2025 provides clear legal recognition for futures contracts as securities, establishes robust regulatory oversight through the SEC, creates a comprehensive framework for commodities exchanges and warehouse receipts, and equips regulators with enhanced enforcement powers to maintain market integrity.

For market participants, including investors, brokers, exchanges, and derivative dealers, the message is clear: futures trading in Nigeria now operates within a defined legal framework that demands compliance, transparency, and accountability. The expanded definition of securities to include commodities, futures, options, derivatives, and virtual assets ensures that all forms of futures trading fall within regulatory purview, while the classification of exchanges provides clarity on licensing and operational requirements.

The enhanced enforcement powers under the ISA 2025, already demonstrated through recent sanctions against market violators, signal a new era of regulatory rigor. The SEC’s zero-tolerance stance on fraud, market manipulation, and non-compliance, combined with robust investor protection mechanisms and dispute resolution frameworks, creates an environment conducive to sustainable market growth.

As Nigeria continues to deepen its derivatives market in line with international best practices, the legal framework will undoubtedly continue to evolve. The recognition of digital assets as securities, the expansion of commodities eligible for futures trading, and the potential establishment of a dedicated commodities futures regulatory body all point toward a future in which Nigeria’s futures market plays an increasingly significant role in the African and global financial ecosystem. For legal practitioners, market participants, and regulators alike, staying abreast of these developments is not merely advisable, it is essential for navigating the dynamic and promising landscape of futures trading in Nigeria.

References

Primary Legislation

  1. Investments and Securities Act, 2025 (ISA 2025). The Act repeals the Investments and Securities Act No. 29 of 2007, establishes the SEC as the apex regulatory authority for the Nigerian capital market, and governs matters including capital formation, investor protection, market fairness, efficiency, transparency, and systemic risk reduction.
  2. Companies and Allied Matters Act, 2020 (CAMA 2020). Cited in relation to incorporation requirements for commodities exchanges and capital market operators.

Secondary Legislation and Regulatory Instruments

  1. SEC Rules and Regulations 2013 (as amended). The principal regulatory framework governing capital market operations in Nigeria, containing provisions on derivatives transactions, including commodities and futures trading.
  2. SEC Rules on Regulation of Derivatives Trading (December 2019). Provides rules to regulate derivatives trading on an exchange, including registration requirements for derivatives contracts and market participants; applies to OTC derivatives trade when specifically mentioned in the relevant derivative contract.
  3. SEC Rules on Regulation of Derivatives and Central Counterparties 2019 (CCP Rules). Outlines the requirements for registration as a central counterparty, including minimum capitalisation of N5 billion, governance requirements, default management systems, and operational rules.
  4. SEC Rules on Virtual Asset Service Providers (VASPs) / Digital Assets Rules. Governs the registration, licensing, and operations of VASPs, digital asset exchanges, offering platforms, and custodians in Nigeria.
  5. SEC Accelerated Regulatory Incubation Program (ARIP) Checklist for VASP Onboarding. Comprehensive checklist guiding VASPs through the ARIP registration process, covering application steps, eligibility criteria, operational requirements, controls, transition to full registration, and post-approval obligations.
  6. Central Bank of Nigeria Guidelines for FX Derivatives in the Nigerian Financial Markets (March 2011). Sets out the approved FX derivatives products that can be offered by authorised dealers in the Nigerian financial markets.

Official Publications and Institutional Sources

  1. SEC Nigeria: Official Website (Who We Regulate). Confirms that the SEC’s regulatory oversight extends to futures, options, and derivatives exchanges, with the Commission registering securities and market intermediaries to guarantee their fitness and suitability.
  2. SEC Nigeria: Interpretive Guidance Notes (IGN). Outlines the Commission’s functions in formulating Rules and Regulations to regulate the market and its players, ensuring transparency, consistency, and fairness.
  3. SEC Nigeria: Commodities Exchange Registration Requirements. Sets out the mandatory documentation and procedural requirements for registering a commodities exchange with the SEC.
  4. NGX Regulation Limited (NGX RegCo). Sanctions five trading license holders for market infractions (wash trades, self-matching transactions, artificial price formation) in breach of ISA 2025 provisions, with fines totalling N291.29 million.
  5. Nigerian Exchange Group: Rulebook of The Nigerian Stock Exchange Derivatives Market (SEC Approved August 2019). Comprehensive derivatives market rulebook approved by the SEC, governing derivatives trading on the NGX platform.
  6. FMDQ Clear: SEC Approval-in-Principle for CCP Registration. Following the publication of the CCP Rules in December 2019, FMDQ Clear secured approval-in-principle as Nigeria’s premier central counterparty.
  7. International Swaps and Derivatives Association (ISDA): Netting Opinions. ISDA has commissioned netting opinions for over 80 jurisdictions, including Nigeria, addressing the enforceability of termination, bilateral close-out netting, and multibranch netting provisions of the 1992 and 2002 Master Agreements.
  1. BusinessDay. “Highlights of the new securities and exchange commission’s rules on the regulation of derivatives trading” (2020/2026). Analysis of the SEC’s 2019 derivatives trading rules, covering contract registration, derivatives clearing member requirements, exchange rules, and permitted participants.
  2. BusinessDay. “SEC’s new rules on central counterparty: Highlights” (2020/2026). Analysis of the 2019 CCP Rules, including registration requirements (N5 billion minimum capital), governance provisions, and functions of a CCP.
  3. Lexology. “Central clearing counterparties in Nigerian financial markets” (2022). Detailed examination of the role, regulatory framework, and operationalisation of CCPs in Nigeria.
  4. Lexology. “The Nigerian Derivatives Regulatory Framework and the Development of an efficient Derivatives Market in Nigeria” (2020). Overview of the evolution of Nigeria’s derivatives regulatory framework, including CBN FX Derivatives Guidelines and SEC Rules on Derivatives Trading and CCPs.
  5. FinTech Association of Nigeria. “Nigeria’s ISA 2025: Key Takeaways from FinTechNGR’s Stakeholder Engagement with the SEC” (May 2025). Analysis of ISA 2025’s provisions on digital assets, virtual asset service providers, online forex trading platforms, and IOSCO alignment.

News Reports and Market Updates

  1. Vanguard. “SEC grants final approval for Lagos commodity exchange” (June 2019). Reports the SEC’s final approval for Lagos Commodity and Futures Exchange (LCFE) to commence commodities and futures trading, effective June 14, 2019.
  2. BusinessDay. “Lagos Commodity and Futures Exchange gets SEC approval to commence operations” (June 2019). Coverage of SEC’s endorsement of LCFE, promoted by the Association of Securities Dealing Houses of Nigeria (ASHON).
  3. Daily Trust. “NGX RegCo Sanctions Five Stockbroking Firms For ‘market Distortion'” (April 2026). Reports on disciplinary sanctions against CSL Stockbrokers Limited, Cowry Securities Limited, Meristem Stockbrokers Limited, SMADAC Securities Limited, and Associated Asset Managers Limited for market infractions under ISA 2025.
  4. Nairametrics. “NGX sanctions five stockbroking firms for ‘market manipulation'” (March 2026). Detailed coverage of the NGX RegCo sanctions, including fines of N91.29 million (CSL) and N50 million each for the other four firms, plus mandatory compliance training.
  5. FSD Africa. “SEC repositioning for investors’ confidence, competitiveness” (July 2023). Identifies the eight main exchanges regulated by the SEC, including AFEX Commodity Exchange Ltd, Lagos Commodities & Futures Exchange Limited, and Nigeria Commodity Exchange.
  6. Nairametrics. “Crypto regulations in Nigeria; these businesses may not survive” (July 2025). Reports on ISA 2025’s crypto regulatory framework, covering four types of players (VASPs, Digital Asset Exchanges, Digital Asset Offering Platforms, and Digital Asset Custodians) and SEC enforcement powers.

Additional Sources

  1. BusinessDay. “Key functions of SEC under investment and securities Act 2025” (July 2025). Summarises the objectives of ISA 2025, including market regulation, capital formation, investor protection, market fairness, efficiency, transparency, and systemic risk reduction.
Disclaimer: This document does not constitute legal advice. For specific legal issues, please consult with a qualified legal professional.
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References & Citations

ISA 2025
source

Investments and Securities Act, 2025 (ISA 2025). The Act repeals the Investments and Securities Act No. 29 of 2007, establishes the SEC as the apex regulatory authority for the Nigerian capital market.

CAMA 2020
source

Companies and Allied Matters Act, 2020 (CAMA 2020). Cited in relation to incorporation requirements for commodities exchanges and capital market operators.

SEC Rules 2013
source

SEC Rules and Regulations 2013 (as amended). The principal regulatory framework governing capital market operations in Nigeria, containing provisions on derivatives transactions.

Derivatives Trading Rules 2019
source

SEC Rules on Regulation of Derivatives Trading (December 2019). Provides rules to regulate derivatives trading on an exchange, including registration requirements.

CBN FX Derivatives Guidelines
source

Central Bank of Nigeria Guidelines for FX Derivatives in the Nigerian Financial Markets (March 2011). Sets out the approved FX derivatives products that can be offered by authorised dealers.

NGX RegCo Sanctions
citation

NGX Regulation Limited (NGX RegCo). Sanctions five trading license holders for market infractions (wash trades, self-matching transactions, artificial price formation) in breach of ISA 2025 provisions.

ISDA Netting Opinions
citation

International Swaps and Derivatives Association (ISDA): Netting Opinions. ISDA has commissioned netting opinions for over 80 jurisdictions, including Nigeria, addressing the enforceability of termination and netting provisions.

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